How to judge "the algorithm"

Attended Brett Caughran's webinar, he talks about long-termism is great and all but theoretical because stock price recalibrates with earnings (or other guidance) results. 

So how do the LOs do earnings season or re-forecast when company changes LT guidance during analyst day? What's LO process when even LO knows the stock is on down trend in the near-term? 

 

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