Earnings Reports: Season Highlights
By Bryan Bottarelli
In this article
Research in Motion (RIMM:NASDAQ) is off more than $11 (an 8% haircut) after reporting that its fiscal fourth-quarter profit surged tenfold from a year earlier.
Another tough luck-earnings loser today is Genentech (DNA:NYSE).
This “half empty” trend does not set a rosy picture for Infosys Technologies (INFY:NASDAQ).
Earnings Reports: Season Highlights
Welcome to earnings season, where good news is bad and bad news is good.
In today's trading, for example, Research in Motion (RIMM:NASDAQ) is off more than $11 (an 8% haircut) after reporting that its fiscal fourth-quarter profit surged tenfold from a year earlier.
Its sales rose 66% on strong demand for Blackberry wireless devices -- and yet the stock is getting hammered on the news.
*Sidenote: I've always thought that RIMM was overvalued. In fact, I specifically remember having a conversation with some WaveStrength readers at the Orlando Money Show about RIMM's lofty values and its ability to move down quickly on any less than stellar news. Unfortunately, anytime I tried to play downside puts on RIMM, the stock has rallied. So I guess I needed some incredible earnings news to spark the sell-off, as opposed to the other way around.
Another tough luck-earnings loser today is Genentech (DNA:NYSE). The stock is down $1.59 (nearly 2%) after reporting that its first-quarter profit surged 68% and its sales rose 43% from the same period a year ago. These numbers appeared to be impressive since sales of two of its key cancer treatments came in lower on a sequential basis -- but apparently Wall Street does not consider the glass to be half full.
This “half empty” trend does not set a rosy picture for Infosys Technologies (INFY:NASDAQ). The Bangalore, India firm is expected to announce earnings of $0.40 per share tomorrow -- which happens to be Friday the 13th. I consider INFY a fantastic company -- and I hope that it reports a strong number. But if the stock keeps up the early earnings trend -- which is falling on strong news -- you could have a good buying opportunity.
Next Monday, heavyweights like Citigroup (C:NYSE) and Eli Lilly (LLY:NYSE) report, and Tuesday April 17 will feature Yahoo! (YHOO:NASDAQ). So I'd expect to see some heavy trading in the following weeks -- get set for some earnings-related volatility!
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Bryan Bottarelli is the head trading tactician for the WaveStrength Group, and is a contributing editor for Taipan Financial News. Coming off the floor of the Chicago Board Options Exchange (CBOE), Bryan uses WaveStrength chart forecasting to develop wining options plays for his service called WaveStrength Options Weekly. Bryan is also the lead editor of BottarelliResearch, an elite membership service that he independently publishes himself.
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