Historical Post Earnings Moves MEGA Compilation AND Analysis (Week 7) – $APPS, $ZM, $CGC, $LULU, $CLDR, $CRWD, $DOCU, $AI and More
What's poppin' bull gang, Flux here with Week 7 of the Historical Post Earnings Moves MEGA Compilation. Although it's a short week this time round, there are still a surprising ammount of companies posting, meaning there's good money to be made! That being said, earnings season is just about over, so there is a good chance that this is going to be the final spreadsheet until Q2 rolls around. Thank you all for joining me for the ride!
All that being said, I love earnings season. It’s an absolute battleground out there. Insane volatility, breaking announcements, and huge moves being made every single day for weeks at a time. What’s not to love? Anyone has a chance to pick the correct tickers, roll the dice, and amass a small fortune. That being said, the unpredictable nature of earnings season often makes or breaks traders – many find that they’re one bad trade away from a complete blowout, so you always need to think about each trade critically. No shame in sitting it out altogether.
To aid us in planning our trades this week, I've compiled a spreadsheet consisting of all of the Historical Post Earnings Moves of EVERY stock reporting earnings this week. Using this spreadsheet, we can determine which options to buy or sell to minimize risk and maximize probability for ANY given ticker. Obviously, past performance isn’t indicative of future success, but we can still use these numbers to gain a general idea of the expected earnings move of a given stock. Gone are the days of getting randomly blown out due to lack of information! If you’re struggling to find a given stock, click on the ticker symbol on the index page, it should hyperlink you straight to the table! If the above link isn’t working for you, refer to the link below!
Please note that scraping and compiling this data took hours. If the sheet has helped you out in any way, please drop an upvote or a comment and peep my socials! It would mean alot to me. Most websites also require you to pay for this data, which I think is a load of shit.
Interesting Observations and Sample Plays
Below I’ve compiled some interesting observations which can further aid us in making trades this week, alongside some sample plays for those who are new to playing earnings and need some guidance. If I missed anything, feel free to bring it to my attention!
- Although risky, Digital Turbine options are inefficiently priced. Similar to ZScaler last week, Digital Turbine has the gambler's edge this week. Historically, Digital Turbine moves roughly 8% post earnings, but the options chain is only pricing in a 5% move this time round. Furthermore, across the past 10 earnings reports, Digital Turbine has moved an average of 15%, giving us an insane edge. Unfortunately, the direction this could go is a complete tossup. Digital turbine is sitting at 4 month lows indicating the potential for a moonshot, and they also postponed earnings by one week, indicating that there's something going on behind the scenes. They claimed they postponed due to the "anticipated completion of a recently announced acquisition", leading me to believe they plan to drop some announcements regarding the merger during the ER call, which could be incredibly bullish. There are lots of strategies you can run this week, but I'm personally going to opt for a long strangle or long iron condor if I can get good fills, or a call debit spread.
- Scotia Bank earnings are very likely priced in already. While the 5 other major Canadian Banks reported earnings last week, Scotia Bank has been banished to this week. Unfortunately for us, we can't make a collateral play on it since it's followed the exact price action as the other 5, while still not reporting earnings. The other banks have gone up roughly 2-3% during earnings week, and scotia bank followed suit on no catalysts. Expect Scotia Bank to stay flat or go down post earnings unless they managed to create money out of thin air, or put forward some insane guidance.
- Slack has capped upside due to the SalesForce acquisition. Although you may look at the historical moves and options pricing and think it's an absolute steal, I would avoid playing this ticker entirely. The details of the acquisition state that shareholders will get $26.79 in cash and 0.0776 shares of Salesforce stock in exchange for each share of Slack on the day of the merger. If you run the numbers, this equates to roughly 45$ per share of Slack. With Slack currently trading at 44$, it leaves us with less than 2% upside on this trade – absolutely abysmal odds and return. Slack has no reason to breach 45$ either, as then shareholders would be paying more for less come the merger.
- Similar to last week, liquidity is suspect. Majority of the companies reporting have godawful options chains. If you think you see an awesome play, make sure you check the volume and open interests in the option chain before committing to it. You'll find that lots of the tickers this week lack any real liquidity on the options chain, so there's gonna be a crater in the bid-ask spread. You're guaranteed to be buying at the ask and selling at the bid, and this huge spread adds additional risk that will balloon your losses and shrink your winners.
Obviously, since I gave data on over 35 companies, there's plenty that I’ve missed. Dive in, have a look around, and have some fun with it! Use the spreadsheet to aid you in picking the safest strikes, and get the best risk-reward possible. Feel free to share your findings too, I’d love to see what you guys come up with.
We’ve got an insane lineup of companies reporting earnings this week, meaning there’s a huge variety of plays to be made for traders of all skills and styles! Use the spreadsheet to determine which stocks offer the best risk to reward ratio, and play accordingly! If enough people found these useful, I'll continue making them throughout the earnings season! If the sheet has helped you out in any way, please consider dropping an upvote or a comment, and checking out my socials, it would mean a lot to me! Happy Trading Everybody! 🙂
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