ajax loader

Loading...


Ride-the-Wave Strategy – Best for Stock Traders

Ride-the-Wave targets multi-day price momentum following a company’s earnings announcement (EA). With this strategy:

  1. Buy a stock one day post-EA if a stock reacts positively post-earnings:
    1. Near the close of trading the EA-day for a pre-market-EA
    2. Near the close of the following day for a post-market-EA
  2. Sell-to-close after 7-10 days, or possibly earlier if a desired price target is reached

Similarly,

  1. short a stock one day post-EA if a stock reacts negatively post-earnings:
    1. near the close of trading the EA-day for a premarket-EA
    2. near the close of the following day for a post-market-EA
  2. then buy-to-close after 7-10 days, or possibly earlier if a desired price target is reached

Important: Ride-the-Wave is predicated on significant price momentum triggered by an EA. The 7-10 day scenario is the maximum trade hold-time. If you see post EA-momentum is halted or reversed by a significant opposite move, re-evaluate your presence in the trade.

This popular StockEarnings screen below will give you a list of stocks that historically exhibit significant price momentum following an EA for the next seven days:

  1. Stocks exhibiting positive post-EA price moves are buy-candidates
  2. Stocks exhibiting negative post-EA price moves are sell/short-candidates

The screen includes those stocks whose Earnings just came out in last two days.

Screen criteria:

  1. Earnings Date Start Date : Current Date + -1 Day
  2. Earnings Date End Date : Current Date + -2 Days
  3. Predicted Move (Next Day) Max : 7%
  4. Predicted Move (On 7th Day) Min : 7%

Strategy Guideline:

  1. Buy the stock if stock has reacted positively. Short the stock if stock has reacted negatively (see above).
  2. Close the position in 7-10 days, or possibly earlier based on price move.

Volatility Crush Strategy - Best for Options Traders

The Volatility Crush strategy is used with stocks that typically experience relatively low-to-moderate price moves (≤4%) following their Earnings Announcements (EA). The basic trade idea is to sell put or call options right before the EA, collecting a credit when options premium is very high due to elevated implied volatility (IV). You then close the position right after the EA by buying the option back much cheaper due to the significant drop in IV that occurs after the mystery of the EA disappears. In assessing this trade, you need to do your homework to ensure you collect sufficient premium to make the trade worthwhile.

This trade is practical due to the low-to-moderate price-move after the EA, which generally won’t significantly affect the options price, unlike an “action” stock, which experience great price moves post-EA. With these symbols, if you’re on the right side of the price move, that’s a great thing. But if you’re on the wrong side of the move, not so great. Consequently, by minimizing the effect of the post-EA price move, you have a much better chance to profit from the reduction in IV without it being ruined by a violent price move.

For this trade, open the position either (1) the night before the EA when the company announces earnings or (2) during the EA day when it announces post-market, generally capturing IV at or close to its peak.

For this trade, open the position either (1) the night before the EA when the company announces earnings or (2) during the EA day when it announces post-market, generally capturing IV at or close to its peak.

This popular stockearnings screen will give you a list of stocks which do not react more than 4% fpost-EA. It includes only those stocks whose earnings are releasing next day.

Screen criteria:

  1. Earnings Date Start Date : Current Date + 1
  2. Earnings Date End Date : Current Date + 1
  3. Predicted Move (Next Day) Max : 4%
  4. Options Type: Weekly

Strategy Guideline:

  1. Options Strategy: Sell Call and Put
  2. Options Strike Price: Current Stock Price – (% Predicated Move x 2)
  3. Expiration Date: It should generally be the closest expiry immediately after the EA.
  4. Buy Insurance: Buying back Call and Put at Strike price which 10% lower than Sell Strike Price is optional but recommended.

Watch Video for More Detail

Volatility Rush Strategy - Best for Options Traders

The Volatility Rush takes advantage of increasing options premiums into earnings announcements (EA) caused by an anticipated rise in Implied Volatility (IV). With this strategy, Buy a Call and Put at-the-money (a long straddle) 2-3 weeks before the EA when IV is lower. Sell the position either (1) the night before the EA when the company announces earnings pre-market, or (2) during the EA day when it announces post-market, generally capturing IV at or close to its peak.

This popular screen will give you a list of stocks whose Options premiums tend to rise into Earnings. It includes only those stocks whose Earnings are at least two weeks away from today.

Screen criteria:

  1. Earnings Date Start Date : Current Date + 15 Days
  2. Earnings Date End Date : Current Date + 30 Days
  3. Predicted Move (Next Day) Min : 5%
  4. Options Type: Weekly or Monthly if that lines up with the two to three-week lead-time for entering the trade

Strategy Guideline:

  1. Buy a Straddle at or close to the money two to three weeks pre-EA.
  2. Sell the position either the night before the EA when the company announces earnings pre-market, or during the EA day when it announces post-market.
  3. Expiration date should generally be the closest expiry immediately after the EA.
  4. Straddle price should not be more 60% of predicted move.

Since Last Earnings

Change in share price since last Earnings release.

Why is it Important?

When share has gained more than 10% since it's last Earning release, it tends to over react to minor bad news and give up some gains if not all. So, it contains more downside volatility than upside When share has dropped more than 10% since it's last Earning release, it tends to over react to minor good news and recover some drops if not all. So, it contains more upside volatility than downside.

EPS Surprise (%)

Occurs when a company's reported quarterly or annual profits are above or below analysts' expectations. Here is the formula to derive % EPS Surprice:

Actual EPS - Estimated EPS
------------------------------------- x 100
Estimated EPS

Why is it Important?

Earnings surprises can have a huge impact on a company's stock price. Several studies suggest that positive earnings surprises not only lead to an immediate hike in a stock's price, but also to a gradual increase over time. Hence, it's not surprising that some companies are known for routinely beating earning projections. A negative earnings surprise will usually result in a decline in share price.

Next Day Price Change (%)

Next Regular trading session Closing price following Earnings result.

For After Market Close Earnings, It is a next trading day closing price. For Before Market Open Earnings, It is the same trading day closing price.

Why is it Important?

Next Day price change is a reaction of Earnings result.

Sign up Now for FREE Trial and receive daily/weekly emails alert for notable Earnings.

Upcoming Notable Earnings

Symbol/Company Earnings Date Predicted Move Since Last Earnings Est EPS
W - Wayfair Inc. Today -
Before Open
13% 6.3% -1.80
COG - Cabot Oil & Gas Corp Today -
Before Open
4% 14.7% 0.57
SHAK - Shake Shack, Inc. Mon 25 Feb -
After Close (3 Days)
7% -3.4% 0.04
THC - Tenet Healthcare Corp Mon 25 Feb -
After Close (3 Days)
5% -11.7% 0.24
MOS - Mosaic Co Mon 25 Feb -
After Close (3 Days)
3% 2.9% 0.57
RRC - Range Resources Corp Mon 25 Feb -
After Close (3 Days)
3% -34.2% 0.16
OKE - ONEOK, Inc. Mon 25 Feb -
After Close (3 Days)
2% 7.2% 0.74
MNK - Mallinckrodt public limited company Tue 26 Feb -
Before Open (4 Days)
7% -24.4% 1.93
M - Macy's Inc Tue 26 Feb -
Before Open (4 Days)
6% -31.7% 2.65

Stocks Screener for Earnings

Need more control with the Screener? Sign up Now for FREE Trial and try our Advanced Screener

Earnings Date

Market Cap

Average Daily Volume

Predicted Move After Earnings

Sign up Now for FREE Trial and get a access to all post notable Earnings.

Post Notable Earnings Analysis

Symbol/Company Earnings Date EPS Surprise (%) Next Day
Price Change (%)
Since Last
Earnings (%)
COMM - CommScope Holding Company Inc Thu 21 Feb Before Open (1 days ago) 34.29% 0.6% 0.6%
VG - Vonage Holdings Corp Thu 21 Feb Before Open (1 days ago) -33.33% -4.32% -4.3%
BG - Bunge Ltd Thu 21 Feb Before Open (1 days ago) -57.89% 1.48% 1.5%
DPZ - Domino's Pizza Inc Thu 21 Feb Before Open (1 days ago) -1.5% -9.15% -9.1%
SFM - Sprouts Farmers Market, Inc. Thu 21 Feb Before Open (1 days ago) 5.56% -3.52% -3.5%
NCLH - Norwegian Cruise Line Holdings Ltd Thu 21 Feb Before Open (1 days ago) 7.59% 3.39% 3.4%
NEM - Newmont Mining Corporation Thu 21 Feb Before Open (1 days ago) 73.91% 0.06% 0.1%
HRL - Hormel Foods Corp Thu 21 Feb Before Open (1 days ago) 2.33% -2.64% -2.6%
VER - VEREIT Inc Thu 21 Feb Before Open (1 days ago) 2.35% -0.74% -0.7%

Earnings News

Roku shares are soaring on earnings beat and strong streaming growth

Roku reported fourth quarter 2018 earnings that beat analyst estimates and provided guidance in line or above expectations for 2019.

CNBC  Fri, 22 Feb 2019 15:14 GMT

Fidelity notches record profit and revenue despite a slowdown in stock markets

Fidelity's operating income rose 19 percent last year, while revenue increased 12 percent to a record $20.4 billion.

CNBC  Thu, 21 Feb 2019 21:44 GMT

Dropbox drops sharply after guidance disappoints

Dropbox beat estimates in the top and bottom lines and had more new paid users than expected. The stock moved lower after the company gave guidance.

CNBC  Thu, 21 Feb 2019 21:41 GMT

Domino's shares skid 9% after same-store sales growth disappoints

Domino's shares sink after the pizza chain disappointed investors with weaker-than-expected earnings and revenue.

CNBC  Thu, 21 Feb 2019 12:44 GMT

Garmin forecasts higher full-year revenue, shares rise

Garmin reported quarterly results that beat Wall Street estimates on Wednesday on the back of higher demand for its smartwatches and navigation systems and forecast full-year revenue above expectations.

CNBC  Wed, 20 Feb 2019 12:42 GMT

CVS shares tumble 8% as forecast takes a hit from investments in Aetna

CVS Health shares crater after the company disappointed investors with a lower-than-expected earnings forecast for the year as it integrates Aetna.

CNBC  Wed, 20 Feb 2019 11:59 GMT

Medtronic quarterly profit beats on strength in surgical products

Medical device maker Medtronic on Tuesday beat Wall Street estimates for quarterly profit, driven by higher sales in its surgical products unit and restorative therapies group.

CNBC  Tue, 19 Feb 2019 13:25 GMT

Walmart shares surge as holiday sales crush estimates, boosted by e-commerce growth

Walmart outpaces analysts' earnings and revenue expectations, as its e-commerce sales surge 43 percent.

CNBC  Tue, 19 Feb 2019 11:52 GMT

Under Armour earnings, sales top expectations. And the stock is swinging all over the place

Under Armour says U.S. sales fell 6 percent during the fourth quarter to $965 million, while international sales climbed 28 percent.

CNBC  Tue, 12 Feb 2019 12:00 GMT

Skechers surges 15% after 'a year of record sales' and strong guidance

Skechers stock rocketed higher after giving strong profit guidance for the quarter ahead while reporting better-than-expected fourth-quarter earnings Thursday evening.

CNBC  Fri, 08 Feb 2019 13:17 GMT

Hasbro's profit took harder-than-expected hit from Toys R Us store closures

Hasbro's fourth-quarter earnings missed estimates by a wide margin, but investors shrugged off the news, after the company outlined a promising slate of new toys for 2019.

CNBC  Fri, 08 Feb 2019 11:46 GMT

Expedia profit falls as it faces a legal fight with United Airlines

Expedia boosted fourth-quarter revenue by selling more hotel rooms and airline tickets, but write-downs pushed profit down 69 percent, to $17 million.

CNBC  Fri, 08 Feb 2019 10:46 GMT

Load More

Sign up today and get access to our software for seven days

Join over 30,000 investors who get daily notable Earnings alerts with predicted move.