Cognex Earnings: Follow the After-Hours Direction

| About: Cognex Corporation (CGNX)

Cognex (NASDAQ:CGNX) is a solid performer on both sides of the trade post-earnings, having secured a strong history of adding to its earnings-driven after-hours gains in next-day regular session trade, as well as consistently heading deeper in the red following evening declines. So if you're going to follow the history, then follow tonight's momentum. It should prove profitable in either direction.

CGNX is due with its Q4 results after the bell. Analysts polled by Thomson Reuters expect the company to report EPS of $0.41 per share on revenue of $84 million.

The stock is maintaining a widening pattern in its session-to-session price moves over the last seven years, with the issue posting wider next-day percentage closing levels 17 times following 26 after-hours earnings events that we have tracked. In the near-term it favors widening as well, doing so in three of the last four quarters.

Looking deeper into the data, the stock has posted post-earnings gains in just 10 of the 26 quarters we've tracked, but when it gains, it tends to follow up that move with a more aggressive next-day performance, widening eight times, or 80% of the time.

Of the 14 declines, that move widened nine times, or 64% of the time. The two other events recorded were flat after-hours trade followed by next-day gains.

On Nov. 1, 2010, CGNX advanced 7.5% In after-hours trade after beating earnings estimates and setting guidance above the Street view. The stock leaped higher the following day, closing the Nov. 2 regular session up 10.7%.

On Aug. 2, 2010, CGNX gained 6.5% in evening trade after reporting better-than-expected results and guidance. The stock cut its upside the next day, closing the Aug. 3 regular session up 5.2%.

On May 3, 2010, the stock gained 1.4% during extended-hours trading after a Q1 beat. Shares rose a slightly stronger 2.3% the next day.

On Feb. 11, 2010, the stock was up 6.6% after earnings and better-than-expected guidance. Shares jumped 8% the next day.

On Nov. 2, 2009, the stock finished after-hours trading flat after an earnings beat. Shares rose 3.5% the next day.

On Aug. 5, 2009, the stock fell 1.5% during evening trading after swinging to a quarterly loss that was deeper than the Street view. The loss was trimmed to 0.3% the next day.

On May 4, 2009, the stock eased 0.1% in evening hours after a Q1 miss. Shares dropped 9.7% the next day.

On Feb. 17, 2009, CGNX was flat in after-hours trade after missing on Q4 revenue and matching earnings expectations. The stock edged up 1.1% in the Feb. 18 regular session.

On Oct. 29, 2008, CGNX shed 7.7% in after-hours trade after missing revenue expectations and setting guidance south of Street estimates. The decline was narrowed sharply the next day as CGNX ended the Oct. 30 regular session down a more modest 1.4%.

On July 28,2008, CGNX tumbled 22.6% in after-hours trade after missing earnings expectations and issuing a disappointing forecast. The downside narrowed in the following day's regular session, with CGNX ending down 16.7%.

On April 28, 2008, CGNX jumped 8.6% in after-hours action after beating on Q1 and setting its Q2 guidance above expectations. The stock added to its upside the next day, rising 12.5% by the close on April 29.

On Feb. 14, 2008, the stock jumped 10.4% during evening trading after the company beat with Q4 results. The gain swelled to 26.2% the next day.

On Nov. 1, 2007, the stock gained 2.5% during evening trading after beating with Q3 results and setting guidance that straddles the Street view. The gain swelled to 18.8% the next day.

On Aug. 15, 2007, the stock fell 7.6% after reporting ahead with Q2 but missing with Q3 guidance. The loss was a wider 11.8% the next day.

On April 17, 2007, the stock dropped 10.4% in the evening hours after a miss and disappointing guidance. The loss was trimmed to 5.5% the next day.

On January 23, 2007, CGNX dipped 1.1% in after-hours trade when the company just missed Q4 sales estimates. Shares sank the next day, closing the regular session down 5.2%.

On Oct. 17, 2006, CGNX shed 8.2% in evening hours when the company missed Q3 sales expectations but beat on EPS. Shares tumbled even more the next day, closing the regular session down 14.9%.

On July 18, 2006, CGNX shed 4.3% in night trade despite reporting Q2 sales in line with expectations and beating EPS estimates. Shares slid even more the next day, ending the regular session down 6.3%.

On April 24, 2006, CGNX dropped 8.7% in after-hours trade when the company missed Q1 estimates. The shares fell further the next day, closing the regular session down 11.4%.

On January 25, 2006, CGNX lost 4.1% in evening trade despite reporting improved Q4 results from a year ago. The shares slipped further the next day, ending the regular session down 6.1%.

CGNX lost 1.9% the night of Oct. 17, 2005 after the company reported in-line EPS, revenue shy of expectations, and guidance matching the FC mean. It saw a far deeper downside on Oct. 18, declining 4.5% by the regular session closing bell.

On July 19, 2005, CGNX gained 8.5% in after-hours trading after topping Q3 estimates and guiding Q3 above the Street. The stock nearly doubled that upmove in the July 20 regular session, soaring 16.2%.

On April 19, 2005, CGNX gained 2.3% after the bell following better-than-expected revenue and in-line earnings. The company also guided in-line to higher. CGNX reversed course in the April 20 regular session, however, closing down 1.3%.

On Jan. 24, 2005, CGNX rose 0.2% after hours following the announcement of in-line revenue and better-than-expected EPS; but the company guided 1Q below the Street target. CGNX gained slightly more in the Jan. 25 regular session, closing up 0.8%.

On Oct. 18, 2004, CGNX dropped 6.2% in after-hours trading after the company missed revenue estimates and guided lower. Traders did not hit the stock as hard in the Oct. 19 regular session, when it closed down 2.5%.

On July 19, 2004, CGNX dropped 5.7% in after-hours trading after the company said it missed revenue targets, but guided EPS higher. Traders pummeled CGNX in the July 20 regular session, and it closed down 11%.

Disclosure: I have no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours.