ajaxloader

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 for 7 day 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
HAS - Hasbro Inc Today -
Before Open
5% 1% 0.31
HAL - Halliburton Co Today -
Before Open
2% -19% 0.41
FE - FirstEnergy Corp Today -
Before Open
2% -0.4% 0.68
HLX - Helix Energy Solutions Group Inc Today -
After Close
7% -3.3% -0.06
WHR - Whirlpool Corp Today -
After Close
6% -9.7% 2.92
GOOG - Google Inc Today -
After Close
5% -12.9%
CBI - Chicago Bridge & Iron Company NV Today -
After Close
5% -13.4% 0.40
CDNS - Cadence Design Systems Inc Today -
After Close
4% -4.4% 0.20
ABX - Barrick Gold Today -
After Close
3% 7.6% 0.15

Stocks Screener for Earnings

Need more control with the Screener? Sign up for 7 day FREE TRIAL and try our Advanced Screener

Earnings Date

Market Cap

Average Daily Volume

Predicted Move After Earnings

Sign up for 7 day 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 (%)
CLF - Cliffs Natural Resources Inc Fri 20 Apr Before Open (3 days ago) 61.9% 0% 0%
TRU - TransUnion Fri 20 Apr Before Open (3 days ago) 15.22% 10.39% -13.3%
SYF - Synchrony Financial Fri 20 Apr Before Open (3 days ago) 12.16% -0.42% -7.8%
RF - Regions Financial Corp Fri 20 Apr Before Open (3 days ago) 12.9% 4.08% -14%
HON - Honeywell International Inc Fri 20 Apr Before Open (3 days ago) 3.17% 0% 0%
SLB - Schlumberger NV Fri 20 Apr Before Open (3 days ago) 0% -1.49% -8.8%
STI - SunTrust Banks Inc Fri 20 Apr Before Open (3 days ago) 16.22% -0.28% -10%
CFG - Citizens Financial Group Inc Fri 20 Apr Before Open (3 days ago) 2.63% 0% 0%
BHGE - Fri 20 Apr Before Open (3 days ago) 50% 0% 0%

Earnings News

Hasbro shares nose-dive after lackluster earnings report; company blames Toys R Us liquidation

Hasbro shares crater after lackluster earnings report; company blames the Toys R Us liquidation for disappointing sales.

CNBC  Mon, 23 Apr 2018 11:16 GMT

Halliburton revenue jumps 34%

Halliburton reported a 34 percent jump in first-quarter revenue on Monday as rising oil prices prompted North American companies to boost oil and gas production.

CNBC  Mon, 23 Apr 2018 10:58 GMT

Alphabet is making three big changes in how it reports earnings on Monday

Alphabet's earnings will look a little different this quarter, including Nest moving out of "Other Bets."

CNBC  Fri, 20 Apr 2018 13:10 GMT

Honeywell raises full-year forecast as aerospace business soars

Honeywell reported a higher-than-expected profit for the first quarter on Friday.

CNBC  Fri, 20 Apr 2018 11:49 GMT

Schlumberger quarterly profit surges 88%

The world's largest oilfield services provider Schlumberger reported an 88 percent rise in quarterly profit on Friday.

CNBC  Fri, 20 Apr 2018 11:19 GMT

General Electric shares jump as earnings top estimates, backs 2018 outlook

The first-quarter report offers further relief for GE, after last week's earnings restatement also held no nasty revelations.

CNBC  Fri, 20 Apr 2018 09:55 GMT

Ericsson first-quarter loss shrinks as cost-cuts pay off; shares jump

Ericsson beat quarterly profit expectations on Friday as savings started to kick in, fueling hopes for a recovery at the struggling mobile equipment maker and sending its shares up 15 percent.

CNBC  Fri, 20 Apr 2018 08:16 GMT

Nestle and Unilever are finding it hard to raise the prices they charge retailers

The multinational makers of everything are under pressure to boost revenues.

CNBC  Thu, 19 Apr 2018 14:34 GMT

Pier 1 Imports' stock craters on disappointing earnings report

Pier 1 Imports' stock plummeted Thursday morning after the company reported sales that missed analysts' expectations.

CNBC  Thu, 19 Apr 2018 13:57 GMT

BNY Mellon profit beats on strong growth across businesses

Bank of New York Mellon reported a better-than-expected first-quarter profit.

CNBC  Thu, 19 Apr 2018 12:48 GMT

Market swings knock Blackstone earnings less than feared

Blackstone said on Thursday first-quarter earnings per share fell 20 percent year-on-year, as a stock market slump weighed on the value of its holdings.

CNBC  Thu, 19 Apr 2018 11:37 GMT

Procter & Gamble earnings top estimates, but market share losses send stock lower

P&G reports better-than-expected revenue, boosted by strong sales in its beauty, fabric and home-care businesses.

CNBC  Thu, 19 Apr 2018 11:04 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.