By Anil K. Ambastha and Kuldip K. Ambastha
Second-quarter earnings season started in earnest this week and will continue for the next 3-4 weeks. This week, the S&P 500, Dow 30, and Nasdaq indices respectively dropped by 1.23%, 0.65%, and 1.18%. Thus, movement of the indices was fairly benign and insignificant. However, individual stocks can and do change significantly based on their earnings reports and future guidance vis-a-vis market expectations based on analysts’ reports.
This week, some of the stocks that moved quite a bit after their earnings reports were Netflix (NFLX), CSX Corp. (CSX), and Union Pacific Corp. (UNP). Netflix dropped by 10.3% by the market close on Thursday largely because of disappointing subscriber growth. Transportation sector stocks such as CSX Corp. and Union Pacific Corp. moved in opposite directions after their earnings reports largely because of their current quarter earnings numbers and their future guidance. CSX Corp. dropped by 10.3% by the market close on Wednesday, while Union Pacific Corp. moved up by 5.9% by the market close on Thursday.
Keywords – Earnings Season, Second-quarter, Earnings report, Transportation sector, Subscriber growth, Future guidance, Market expectations.
Disclosure – The principals of Ambastha Financial LLC have short option positions in CSX and NFLX. They also have a long equity position in NFLX. No recommendations are being made via this post. As an investor, you should do your own research and seek professional advice from a Registered Investment Adviser (RIA). You can lose money by investing in stocks and other investment instruments. Ambastha Financial LLC does not assume any responsibility (legal or otherwise) for any losses that may occur as a result of actions taken based on this post. All content copyrighted © 2019 – Ambastha Financial LLC.