- The Earnings and Events to Watch the Week of July 31
- What to Expect from Markets the Week of July 24
- Everything You Need to Know About Second-Quarter Earnings Season
- How to Play PayPal's Earnings Before They Hit on Nov. 2
- 3 Stocks to Trade This Week Before Their Earnings
- These Five Earnings Trades Let You Cash In When a Stock Moves Up... or Down
- Johnson & Johnson (JNJ) Is a Stock to Buy and Hold
- The Best Way to Profit on the Most Important Earnings Season in 10 Years
- Why Earnings Per Share Estimates Can't Be Trusted Right Now
- Follow These Rules to Profit from This "Trading Range" Market as Earnings Come Out
- Crush the Next Earnings Season - and Every One After - with This Simple Plan
- Here's a Juicy Earnings Season Play for You
- What Wall Street Gets Wrong About This "Kind-Of Rally"
- What Every Investor Should Know About Canopy Right Now
- Here's the Sector That Will Affect Markets the Most This Week
- Here Are the Cannabis Earnings Reports I'm Watching in This Big Revenue Quarter
Shah Gilani breaks down the implications of second-quarter earnings season, and why the optimism analysts are showing may be unfounded.
I see it every time earnings season rolls around, and it always bums me out: Millions of investors try to pick the right stock to buy at the right time for the right price, hoping maybe the company they've picked beats earnings estimates this time.
If they're right, they can pocket 7%, 10%, 15% in profits. If they're wrong, oh well - there's always next quarter.
It might sound like investing, but it's not all that different from rolling the dice or betting the ponies. Going through earnings season like that is a gamble - one that no one needs to make. It's even riskier during a global pandemic when companies are either crushing it or barely getting by.
You don't need to leave money on the table, though, or sit earnings out. You don't have to risk for the chance to pocket a little.
The smarter, safer, and just plain more profitable way to speculate on corporate earnings is to trade them. That way, you're in and out, counting your gains before the report hits the Street.
You don't necessarily need management to hit a home run; the stock doesn't need to skyrocket, it just needs to move.
And you don't have to take my word for it, either. I'm going to show you how this works with a company I suspect just put a very solid quarter on the books: PayPal.
It's the most important earnings season of the year - actually, in 10 years.
Companies need to show they're worth their soaring stock prices.
Some will succeed and see shares go higher, while others will take a hit.
We are in the midst of one of the most important earnings seasons to date.
The coronavirus has impacted revenue across the globe, and it isn't over. Now we're getting a glimpse as to how big that impact is.
The pandemic has left 174 million people unemployed worldwide, which has ultimately resulted in $2.1 trillion in lost income. Yet the Nasdaq just hit an all-time high of 11,069.
We don't know which way each stock will go after earnings, but we don't need to...
What we do know is there will be volatility in the coming weeks - and where there's volatility, there's opportunity. There are tons of gains on the table for your taking.
Today, I'm going to show you a strategy that allows you to secure profits no matter what direction stocks move on their earnings reports.
Johnson & Johnson (NYSE: JNJ) stock just beat earnings expectations, while also showing falling profit.
But the drop in profit is not a reason to dump this stock right now.
Four times a year - once each quarter - publicly traded companies drop their protective veil and give investors a look at their books.
It's kind of like a financial "State of the Union."
We call it "earnings season."
It's always one of the most important times of the year for stocks.
And the current earnings season - which started this week, and which will continue through the month of July - is the biggest and most important in a decade.
Not since the Great Recession of 2007-2009 have the stakes been so high.
At risk is the $10 trillion in shareholder wealth that's been created since the market bottomed in March.
In my 30 years of professional trading, I've never seen a stretch where investors needed actual results and "forward guidance" from companies reporting their earnings as much as they do right now.
My job - and I love it - is to categorize the stocks of these companies as "high risk" or "low risk" and to guide you accordingly. What I'm going to show you will let you add to your portion of that $10 trillion windfall - and avoid giving any of it back...
Earnings per share estimates are badly out of whack right now, which is skewing valuation metrics investors use to judge whether stocks are properly valued.
The market volatility from the coronavirus pandemic has created a lot of uncertainty that has caused a delay in analyst updates of their EPS estimates.
That has stocks looking cheaper than they really are.
My glasses almost fell off my face Monday night when I read this headline from Bloomberg...
"ETF Investors Are All-In on Stimulus with $17 Billion Stock Bet"...
That's right. Investors have pumped more than $16.5 billion into stock exchange-traded funds in just seven trading days in April.
The article stated that the "torrid" pace put inflows on track to exceed December's monthly inflow total of $42.5 billion.
Talk about a crowded trade...
What's happening right now is a toxic combination of analysts saying, "The bottom's been put in!" and also, "Buy the dips!"
Yes, you can start to buy in. Slowly. Use dollar-cost averaging and buy in increments.
But going all in... Well, there's a reason the great Wayne Gretzky said to skate to where the puck is going, not where it has been...
That's exactly why the last time I saw this happening, in December, I bought puts. And they paid off heavily in January and February, such as my 47.87% January gain on FedEx and my 108.57% February gain on Tilray.
The truth of this market is that there's still too much uncertainty, fundamentals are questionable, and technicals are pointing to the downside.
This type of long bet - with people throwing money into the market with coal shovels because it's been climbing for a few weeks- tells me one thing: We're still in the first stage of the market pullback.
Earnings season is wrapping up, and as usual, a lot of profits have been left on the table.
This should be the most profitable time of year. But so many traders miss the best opportunities.
That's why I trade earnings differently than everyone else.
I'm not an analyst. I don't give much thought to revenue and earnings per share (EPS). If you only focus on the top and bottom line, earnings can get really complicated, really quickly.
So I created my three-step earnings trading plan.
This plan simplifies the earnings process and still comes loaded with that same exciting profit potential that earnings brings.
For anyone who doesn't feel like they're making as much as they could from earnings, this plan will help you profit every single quarter, like clockwork.
The Dow and S&P 500 both broke three-week losing streaks last week, and the Nasdaq Composite was up for the second week in a row.
We're heading back up closer to all-time highs.
So why do I say this is just a "kind-of rally" with all this seemingly good news?
Last week was an otherwise down week if not for the one positive lifting market on Friday: trade talks.
This was good news, until it was stripped down and re-rated by market judges.
The United States looked like it scored a victory because China agreed to purchase $40 billion to $50 billion in U.S. agricultural products, at least according to the White House, but the time frame of any purchases wasn't immediately clear.
Also, China agreed to open its market to international financial services, again according to the White House. Trump, potentially allowing U.S. banks and insurance companies to expand in China: no timetable there either.
China looks like it scored on account of the United States not moving forward on Oct. 15 with a planned increase in tariff rates to 30% from 25% on about $250 billion of Chinese goods.
Canopy Growth disappointed investors with its quarterly earnings. In fact, investors were so "disappointed" by this one report they sent the entire cannabis sector tumbling.
That's the thing: Canopy's results mean essentially nothing at all for American marijuana companies - nothing for any company outside Canada, in fact.
It's no different than if, say, California-based PG&E shares tanked because Consolidated Edison had a power failure in New York City.
But we're still in the early stages of legal cannabis' explosive growth potential.
Canopy led the sector down because investors are expecting results yesterday. And the results can be longer in coming than short-sighted investors might like.
Our Technical Trading Specialist is continuing to keep a close watch on the markets for the week ahead, including the most impactful earnings reports and sector that will act as a bellwether for the broader economy…