The periodic grumble about earnings quality and management appears (here) and (here). Along with it is my periodic grumble that it is not the news which matters but the reaction to it.  Unexpectedly “bad” or “good” earnings cause huge moves in the pre-market, while mediocre earners frequently pop on “beats” making it hard to set up anticipatory plays.  The former are impossible to play, somewhat efficient reactions of price to new information, while the latter are better plays after a few days and the news is digested (post-earnings announcement drift, is what my tribe calls it). Lest you forget, a ” beat” is only that of analyst estimates and these guys  have generally been a pessimistic bunch lately.


Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out / Change )

Twitter picture

You are commenting using your Twitter account. Log Out / Change )

Facebook photo

You are commenting using your Facebook account. Log Out / Change )

Google+ photo

You are commenting using your Google+ account. Log Out / Change )

Connecting to %s