Seeking Alpha
Event-driven, short-term horizon, long/short equity, special situations
Profile| Send Message|
( followers)  

Sears (NASDAQ:SHLD) is expected to report fiscal fourth quarter earnings on Thursday, February 28th. The whisper number is $0.96, two cents behind the analysts' estimate. SHLD has a 56% positive surprise history (having topped the whisper in 9 of the 16 earnings reports for which we have data).

Earnings history:

- Beat whisper: 9 qtrs
- Met whisper: 0 qtrs
- Missed whisper: 7 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:

(click to enlarge)

The strongest price movement of -2.1% comes within ten trading days when the company reports earnings that beat the whisper number, and +9.1% within thirty trading days when the company reports earnings that miss the whisper number. This is known as an 'opposite' reaction as the company sees weakness when it tops expectations, and strength when it falls short of expectations. As you can see in the table above the short term price reaction when the company tops the whisper number is negative thru twenty trading days before turning and seeing limited strength through thirty trading days.

The company has not seen a great deal of attention from investors over the past few years as there has not been a whisper number since May 2011. Enter your expectation and view more earnings information here, or let us know your expectation in the comments section below.


Since 1998, 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.

Source: Whisper Number Impact: Earnings Preview For Sears