According to the case law as of the date of this article, a provision in a real estate contract that requires a seller to deliver at closing a report from a licensed
pest control company showing the property free of termites does not require a seller to repair termite damage.
But if
companies can
show that they have adequate
control over their financial results such that they forecast future earnings and they honestly come to pass, investors will think the place is better managed than most, and reward it with a higher
P / E multiple.