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We Can’t Study Short-Termism Without the Right Metrics

Harvard Business Review

If a company has beat or missed its EPS targets by less than two cents , that means the company has nipped and tucked its quarterly results just enough to meet the target EPS number it committed to analysts. Of these, the last indicator is perhaps the most likely to accurately capture a company’s short-termism.

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Finally, Proof That Managing for the Long Term Pays Off

Harvard Business Review

These indicators and hypotheses were: Investment: The ratio of capex to depreciation. Earnings-per-share (EPS) growth: Difference between EPS growth and true earnings growth. Quarterly targeting: Incidence of beating or missing EPS targets by less than two cents. Earnings quality: Accruals as a share of revenue.