We are in the quarterly earnings season, and there is a lesson to be learned here.
What the company should learn is that, analysts ask the company for its prediction of the quarterly earnings, early in the quarter. The consensus then is the opinion of the average prediction of the management performance. Then, when the results come out, the price of the stock will be adjusted from consensus value to performance value.
If we look at it that way, then consensus would be $115 million sales for this quarter in April time frame. Projected earnings would have been $0.45/share. When the actual performance will be announced, such as $0.70+/share because of better sales revenue; then the stock will have a big jump.
On the other hand, no analysts in any brokerage recommended this stock; and everyone expected the earnings to be such that a few extra cents will not be outperform by the management; we have a problem of buy on the rumor and sell on the news.
It is a hard lesson to learn. But, we all grow with the management, and we must learn along with them.
The whisper number is 65 cents for the past quarter, and anything over $0.70/share should give SEMI a gap up on opening after the announcement of earnings.
Remember, how Intel and Microsoft always down play their next quarterly earnings; so that their stock always go up quarter after quarter. We should carefully observe that tradition. We have to start our tradition some where in time. Now is the time.
The numbers used, is just for illustrative purposes. |
