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How to Hack Company Earnings Reports


We are now right in the thick of earnings season for the second calendar quarter. 

And so far, earnings reports have been largely positive for many, many companies.

In fact, for the member companies inside the S&P 500 Index, 348 of the 505 companies have reported as of this writing. 

And the average sales gain reported is running at 28.3% with the average earnings gain running at 96.6%.

This is all generally good to great news for the market.

But the market is one thing. And average sales and average earnings for the S&P 500 Index members doesn’t mean that all have great earnings reports. 

Others have had much, much better reports.

The stocks that I put into the Watch List each week aren’t just about a single earnings report but our proprietary Stock Surge Indicator (SSI) system. 

To get the full Watch List for this week, click here.

A Special Invitation

Before I get further into today’s issue, I want to invite you to a special live session that I’m doing tomorrow at 12:00 p.m. EDT. 

In the session, I’m going through one of the key components of the Stock Surge Indicator (SSI) – insider buying. 

And I’ll also present my newer product that also focuses on insider buying called Insider Edge

To RSVP for free to the session click here.

Now, back to the issue for today…

What Moves Stocks

Nothing makes stocks move more than earnings reports.

These quarterly filings give investors an updated look at how well a company is doing.

A few months back, Zoom (ZM) reported net income of $186 million for the quarter – a 588% increase over the previous quarter

Shares jumped 47% on the news.

Daily Chart of Zoom Video (ZM) — Chart Source: TradingView

But earnings aren’t the only metric investors are watching.

This report, known officially as a Form 10-Q, includes total sales, net earnings, subscriber growth, cash-on-hand and dozens of other metrics Wall Street monitors to value a firm’s stock. 

For Tesla (TSLA), investors often focus on total vehicle deliveries to see how quickly the company is scaling up production.

Retailers like Macy’s (M) and Target (TGT), on the other hand, are evaluated more heavily by same-store sales growth, or how efficiently the company is monetizing its square footage.

Every company reports this data, along with management’s remarks and future projections every three months.

It is an SEC-mandated requirement for every publicly traded firm.

If you know what’s in the report before it comes out, you can make a lot of money.

Better-than-expected numbers will make the stock go up. Disappointing number will send it down.

Unfortunately, company executives are forbidden from sharing this information before it is made public.

Traders betting on earnings reports have a 50/50 shot at getting it right.

But there are two tricks to help put the odds in your favor…

The first is to follow insider buying.

You see, when an insider buys or sells his company’s stock, he must report that trade within 48 hours.

And that report, known as a Form 4, is available to the public immediately.

If you see several company insiders making large purchases in their personal accounts in the days leading up to a major earnings announcement, that could be a sign they’re positioning themselves to profit from positive news.

You generally won’t see this from closely monitored mega-caps like Apple (AAPL) or Microsoft (MSFT), but in micro- and small-cap stocks, it is more common than you think.

We have profited from these signals numerous times in the Insider Edge product that I just mentioned above.

To RSVP for free to the live coaching session tomorrow at 12:00 p.m. ET, click here.

But that’s not the only trick…

There’s another way to “hack” company earnings and put the odds in your favor.

All you have to do is watch the calendar.

As I mentioned earlier, these earnings reports are released once a quarter.

So, if the last one came on July 1, the next announcement will likely be on October 1 – three months later.

But sometimes it’s not.

Sometimes companies push back or move up the announcement date.

A research paper published by The University of Texas and MIT discovered that when a company announces earnings three or more days before their estimated announcement date, the news tends to be better.

When they announce three or more days after the estimated date, the news tends to be worse than expected.

The statistics prove it.

And really… it just makes sense.

Executives want to get good news out as soon as possible.

Bad news? Not so much.

This technique isn’t fool proof.

But it will definitely get your odds above 50/50.

To track earnings dates, the website I like to use is EarningsWhispers.com

Simply enter in a ticker symbol, and it will give you the estimated or confirmed date of that company’s next earnings announcement.

Mark it on your calendar.

If you see that date change by more than a couple days, it might be a hint at whether they will beat or miss expectations.

One Last Thing

Thank you for reading and subscribing to Traders Daily Direction. And we do hope that you’ve been cashing in on so many of the surging stocks that we’ve been presenting each and every week in the Watch List. And again, the full writeups on all of the stocks in the Watch List can be accesses right here: (TKTK).

All of the stocks that we present are vetted by our proprietary Stock Surge Indicator (SSI) system. And again, you can get the full rundown on how this works with the free download of the special report: The Magic of the SSI right here: (TKTK).

We have taken the SSI system to the next level with our newer Insider’s Edge product. 

Insider’s Edge focused on the component of the SSI system of insider buys. Insiders have the definitive information on their companies and their stocks – so following their lead when they buy can provide some major advantages in trading stocks.

And as noted above, I’m doing a special coaching session tomorrow on insider buys that you are invited to attend free of charge. To RSVP, please click here: (TKTK).

If you’ve made a dime from the stocks inside Traders Daily Direction – you owe it to yourself to try Insider’s Edge. For a special offer and further information on Insider’s Edge, click here: (TKTK). And if you have any questions, please call our team at 888-483-5161.

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