Do Longs Catch Better Trade Off Salesforce.com's Earnings-Driven After-Hours Action?

| About: Salesforce.com, Inc. (CRM)

Salesforce.com (NYSE:CRM) is set to report Q1 results in tonight's after-hours. Analysts polled by Thomson Reuters are expecting the company to report a profit of $0.27 per share on revenue of $483 million.

CRM just favors a reversal trend between the bells following its after-hours earnings reports, narrowing or reversing 15 times and widening 11 times in next-day trading following its last 26 extended-hours earnings reports. The near-term trend is mixed, with two widening moves and two reversal trades over the last four quarters.

Looking deeper into the performance data, CRM has recorded an earnings-driven after-hours decline in 15 of the 26 quarters we have tracked, reversing direction in next-day trade in 10 of those events, or nearly 67% of the time.

On the plus-side, the stock favors widening between the sessions when it records earnings-driven after-hours gains, which it has done in 11 of the 26 quarters we've followed. Of those 11, the stock has widened six times and reversed direction five times.

On Feb. 24, 2011, CRM gained 8.6% in evening trade after posting higher-than-expected Q4 results and setting mixed guidance. It lost a good chunk of its upside the following day, closing the Feb. 25 regular session up 3.3%.

On Nov. 18, 2010, CRM advanced 8.8% in after-hours trading after beating Q3 expectations and setting in-line guidance for Q4. The stock surged higher the following day, closing the Nov. 19 regular session up 18.1%.

On Aug. 19, 2010, CRM advanced 7.4% in evening trading after posting better-than-expected Q2 results. The stock rocketed higher the next day, closing the Aug. 20 regular session up 17%.

On May 20, 2010, CRM fell 4.3% in after-hours trading despite meeting Q1 EPS views and topping on sales. It predicted FY sales would meet or beat expectations. Shares, though, reversed those losses and ended the next day's regular session up 5.3%.

On Feb. 24, 2010, CRM rose 2.1% in evening trading after beating Q4 estimates and offering strong Q1 and FY11 EPS guidance. However, the next day, the stock failed to build on those gains. Instead, the stock fell 2% in regular trade.

On Nov. 17, 2009, the stock fell 4.1% after a Q3 revenue beat but mixed guidance. Shares declined a slimmer 3% the next day.

On Aug. 20, 2009, the stock advanced 8.1% during evening trading after beating revenue estimates and raising its outlook. Shares jumped 16.2% the next day.

On May 21, 2009, CRM shed 7.8% in after-hours trading after meeting Q1 revenue expectations but cutting its FY2010 revenue outlook. The stock slumped a deeper 8.8% in the May 22 regular session.

On Feb. 25, 2009, CRM advanced 5% in after-hours trading after beating Q4 estimates. The stock narrowed its gains significantly the next day, ending up 1.6% in the Feb. 26 regular session.

On Nov. 20, 2008, the stock gained 3.1% after beating with Q3 results but offering mixed guidance. The stock fell 2.2% the next day.

On Aug. 20, 2008, the stock fell 7.3% after the company guided mostly in line. The loss swelled to 18.4% the next day.

On May 21, 2008, the stock fell 0.6% during evening trading after beating by a penny with Q1 EPS. Shares rebounded to gain 5.8% the next day.

On Feb. 27, 2008, the stock gained 9.6% during evening trading after reporting strong Q4 results. The stock jumped 17.1% the next day.

On Nov. 15, 2007, the stock eased 0.6% during evening trading after CRM reported ahead of the Street with Q3 sales and guided for sales in line to above. The stock rebounded to gain 12.9% the next day.

On Aug. 15, 2007, shares edged up 0.7% in evening trading after CRM said Q2 topped the year-ago period, but updated guidance was mixed. The stock fell 3.6% the next day.

On May 16, 2007, CRM slipped 1.2% in night trading despite topping Q1 sales estimates. Shares lost more ground the next day, closing the regular session down 5%.

On Feb. 21, 2007, CRM dropped 4.5% in the evening session after beating Q4 sales estimates but forecasting Q1 sales in line to below expectations. Shares recovered a bit the next day, ending the regular session down 1.4%.

On November 15, 2006, CRM shed 2.3% in night trading after just topping Q3 sales estimates but forecasting Q4 sales to be in line to below expectations. Shares trimmed their losses the next day, closing the regular session down 1%.

On Aug. 16, 2006, CRM surged 12.3% in after-hours trading after the company beat on Q2 and set guidance mostly in-line to higher. The stock added to its upside in the Aug. 17 regular session, rising 19% by the closing bell.

On May 17, 2006, the stock fell 3.2% in the evening hours after reporting ahead of the Street with Q1 results but guiding lower. The loss grew to 5% the next day.

On February 22, 2006, CRM dropped 4.3% in night trading after missing Q4 sales estimates but meeting on earnings. The company also forecasted Q1 sales below Street views. However, the shares recovered some of their losses the next day and ended the regular session down 1.1%.

On Nov. 16, 2005, shares fell 2.4% on the release of figures showing Q3 revenue of $82.7 million, above the First Call consensus estimate of $80 million. Non-GAAP earnings per diluted share were $0.05, a penny above the FC mean. The company upped its full-year guidance. Shares recovered to post an 8.5% gain the following day.

On Aug. 17, 2005, CRM tumbled 11.5% after Q2 results matched Street targets and it guided Q3 in line to lower. It slid only 8.4% in the Aug. 18 regular session.

On May 18, 2005, CRM jumped 7.9% after topping Q1 expectations and raising its FY06 outlook. It found more upside in the May 19 regular session, surging 11.7%.

On Nov. 17, 2004, CRM dropped 5.4% despite besting Q3 estimates and issuing in-line FY05 guidance. Traders hammered the stock in next-day trade, and it plummeted 14.4% in the Nov. 18 regular session.

On August 19, 2004, CRM fell 3.2% after posting in-line Q2 results. It reversed course and climbed 3.5% in the August 20 regular session.

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