Caveat: Market prices are largely driven by huge pension funds and other institutional funds. These are judged by their customers on their annual or even quarte

Caveat: Market prices are largely driven by huge pension funds and other institutional funds. These are judged by their customers on their annual or even quarterly returns. Therefore, given a choice between long-term and short-term returns, their managers are compelled to choose the former. Thus, stocks with great long-term returns but poor short-term returns will not be correctly priced by the market - even if it's obvious from well-known information. An example is when a stock is hit by publicized litigation, that will drain some cash, but not impact their core business. Not only does it look bad, but it will negatively impact their hard numbers... in the short-term.