Wednesday, May 6, 2015

3 Post Earnings Drift Buy Candidates

$AMZN $DNKN $GPRO all reacted extremely well after they reported their most recent earnings. By well I mean that they were up 4% or more after the report on volume 3 times their 50 day volume average. Amazon was up 14% after their earnings release, Dunkin +7.9%, GoPro +12.6%., all 3 companies reported in the Middle of April.

Since their earnings release these stocks have all digested the initial earnings pop by pulling back, this when the opportunity lies.  When a stock makes a significant move on relatively heavy volume after their earnings report one can assume that the street was caught by surprise and stock will probably experience a post earnings drift until the following quarter.  As a speculator we want to jump aboard the surprise when the stock offers a good risk reward opportunity.  With the recent pullback not only in these 3 stocks but also in the Russell 2000 and Nasdaq these stocks are now offering decent risk reward trades.

Generally speaking when the market is pulling back and you are looking for buy candidates, the stocks that reacted extremely well to their earnings report is a great place to start.

The information in this blog post represents my own opinions and does not contain a recommendation for any particular security or investment. I or my affiliates may hold positions or other interests in securities mentioned in the Blog, please see my Disclaimer page for my full disclaimer.

1 comment:

  1. Good post but I was wondering if you could write a litte more on this subject? I’d be very thankful if you could elaborate a little bit further. Appreciate it!