Saks Inc. (SKS) is expected to report fiscal fourth quarter earnings on Tuesday, February 26th. The whisper number is $0.16, one cent ahead of the analysts' estimate. SKS has a 50% positive surprise history (having topped the whisper in 6 of the 12 earnings reports for which we have data).
- Beat whisper: 6 qtrs
- Met whisper: 2 qtrs
- Missed whisper: 4 qtrs
Our primary focus is on post earnings price movement. Knowing how likely a stock's price will move following an earnings report can help you determine the best action to take (long or short). In other words, we look at what happens when the company beats or misses the whisper number expectation.
The table below indicates the average post earnings price movement within a one and thirty trading day timeframe:
The strongest price movement of -6.5% comes within five trading days when the company reports earnings that beat the whisper number, and -5.9% within thirty trading days when the company reports earnings that miss the whisper number. Beat or miss the whisper number and the overall average price move is negative.
The table below indicates the most recent earnings reports and short-term price reaction:
The company has not seen a great deal of attention from investors over the past few years. Overall the stock has been range bound and neutral (although from a percentage basis the moves have been strong). The company has only had a whisper number in two of the past eight quarters. In May 2012, the company reported earnings one cent ahead of the whisper number. Following that report the stock realized a 5.2% gain in five trading days. Last quarter the company reported earnings in-line with the whisper number. Following that report the stock realized a 12.5% gain in twenty-five trading days. These recent reports move against historical averages and may be indicative of a stock that now sees strength when it tops expectations, and weakness when it misses.
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Since 1998, WhisperNumber.com has been tracking and publishing "crowd sourced estimates" for earnings. We call these earnings expectations whisper numbers. Our whisper numbers are gained from individual investors and traders just like you that have registered with our site. While the whisper number itself is an important part of our analysis, a company's "price reaction" to beating or missing 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.