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Brocade Communications (NASDAQ:BRCD) is expected to report fiscal first-quarter earnings on Thursday, Feb. 14th. The whisper number is $0.17, one cent ahead of analysts' estimates. Whisper numbers range from a low of $0.15 to a high of $0.20. BRCD has a 58% positive surprise history, having topped the whisper number in 19 of the 33 earnings reports for which we have data.

Earnings History

  • Beat whisper: 19 quarters
  • Met whisper: 1 quarter
  • Missed whisper: 13 quarters

The average price movement (starting at the next market open) within 10 trading days of all earnings reports is +0.6%. The strongest price movement of -5.8% comes within 30 trading days when the company reports earnings that beat the whisper number, and +4.3% within one trading day when the company reports earnings that miss the whisper number (opposite reactor).

Last quarter, the company reported earnings one cent ahead of the whisper number. Following that report, the stock realized a 2.5% loss in after-hours trading, but recovered with a 6.3% gain in five trading days. Enter your expectations and view more earnings information here, or let us know your expectations in the comments section below.

Knowing how likely a stock's price will move following an earnings report will help you make better trades. Many investors believe that beating or missing the whisper number has the greatest impact on stock movement. If the number is exceeded, the stock is rewarded and prices move higher. If the number is missed, the stock is punished and prices move lower. Unlike the analysts' estimates, the whisper number from WhisperNumber.com has actually been proven to have a greater impact on stock movement.

Since 1998, WhisperNumber.com has been tracking and publishing crowd-sourced estimates for earnings. We call these earnings expectations whisper numbers. The crowd that provides us with whisper numbers are primarily individual investors and traders just like you who have registered with our site. We are an independent financial research firm. We have no affiliations with investment banks, investment management, or corporate organizations that could compromise our data or analysis. (So no relationships with the bad guys or so-called professional analysts.)

As for our data collection, methodology, and price reaction accuracy, for the past 15 years we have remained consistent with data collection and methodology, and our data has proven itself over that time. We also have two independent academic studies supporting the premise that investor expectations for quarterly earnings (our whisper numbers) provide greater returns when used as an investment vehicle, and have a greater impact on stock movement than analysts' consensus estimates.

A company's price reaction to the whisper number expectation is the key -- on average, companies that exceed the whisper are rewarded, while companies that miss are punished following an earnings report. According to the Wall Street Journal, "positive surprises are becoming so common they are nearly universal. They are predetermined in a cynical tango-clinch between companies and the analysts who cover them. All the numbers are gamed at this point." This is why the proprietary whisper number we provide is a more useful and viable alternative to analysts' estimates.

All trading involves risk, and the information presented is not intended to be a recommendation of any kind.

Source: Whisper Number Impact: Earnings Preview For Brocade Communications