GE coverage exposes risk in writing about earnings before they happen

TheStreet.com media critic Marek Fuchs writes Saturday about all of the pre-coverage of General Electric Co.’s earnings that noted how the conglomerate was expected to report a profit increase. Oops. GE reported a decline.

Fuchs wrote, “The business media raised false expectations for results that were — shockingly — ruined by their financial service business.

“All the breathless coverage at fault gets this week’s dreaded Business Press Maven ‘Back of the Hand’ award.

“Here‘s a Wall Street Journal headline to choke on. And not to be underdone, an Associated Press story began with what would soon be shown to be false: ‘Conglomerate General Electric is expected to report healthy profit growth on Friday. GE is considered an economic bellwether, as its orbit extends into entertainment, consumer and industrial manufacturing, finance and health care.’ Oh well. You know what they say: Easy come, easy go for those bellwethers.

“Speaking of easy come, easy go, how ’bout that GE commentary on Thursday’s Fast Money? The guys there can’t actively recommend the stock since the company owns CNBC, the network that airs their show, so they spoke around the ban. And boy did they speak — saying that GE really doesn’t miss, that GE invented sandbagging (holding back on earnings expectations so you can surpass them), that you can look for clues in the recent insider buying and that GE is so diversified that it could weather everything but global apocalypse.

“Hmm, I guess GE’s not so diversified it can weather financial service-division apocalypse.”

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