Dollar Tree (NASDAQ:DLTR) is expected to report fiscal fourth quarter earnings on Wednesday, February 27th. The whisper number is $1.05, six cents ahead of the analysts' estimate. DLTR has a 57% positive surprise history (having topped the whisper in 16 of the 28 earnings reports for which we have data).
- Beat whisper: 16 qtrs
- Met whisper: 0 qtrs
- Missed whisper: 12 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 30 trading day timeframe:
The strongest price movement of -5.7% comes within 30 trading days when the company reports earnings that beat the whisper number, and -3.5% within 20 trading days when the company reports earnings that miss the whisper number (negative reactor).
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. The stock appears to have peaked and stalled mid-year 2012. Since then, it's been a slow and painful fall (of about 25%). The company has only had a whisper number in two of the past eight quarters. In February 2012, the company reported earnings one cent short of the whisper number. Following that report, the stock realized a 2.7% gain in five trading days. In August 2012, the company reported earnings two cents ahead of the whisper number. Following that report, the stock realized a 1.4% loss in five trading days. These recent reports suggest the stock is an "opposite" price reactor -- sees strength when it misses expectations, and weakness when it beats.
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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.