Horace Dediu tells the story. The narrative is fictional, but the numbers, sadly, are real. 

Source: Asymco

In masterpiece of analytical satire, Asymco‘s Horace Dediu on Thursday recreated the thought processes that led Wall Street’s top analysts to grossly underestimate Apple’s AAPL earnings every year since 2005.

Their performance would be laughable if it didn’t materially affect Apple’s share price. But the numbers these analysts come up with form the “consensus” that determines the forward price-to-earnings (P/E) ratio — the basic measure of whether a stock is fairly priced.

Dediu’s little tale of infectious pessimism in the face of market disruption is a great read, and a lesson for those who wonder why Apple’s stock is so cheap. Don’t miss his responses in the comment stream. Click here.