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In financial reporting, guidance is a publicly traded corporation's official prediction of its own near-future profit or loss, stated as an amount of money per share. Guidance is usually given in a quarterly report to forecast the corporation's performance in the next quarter. Guidance is an aid to financial analysts and the stock market in valuing the corporation, and helps prevent overvaluation.
According to Investopedia, Guidance refers to Information that a company provides as an indication or estimate of its future earnings. It is also known as "earnings guidance." Guidance reports estimating a company's future earnings have some influence over analyst stock ratings and investor decisions to buy, hold, or sell the security.
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