To: Jenna who wrote (5746 ) 3/13/1998 5:15:00 PM From: Jenna Read Replies (1) | Respond to of 120523
Recap of last weeks earnings plays: Friday March 6: FPAM, OSTE,SNRZ Monday March 9: AHOM,HGR,PPH,KELL Tuesday, March 10: GADZ, HAZ, KSS, MIKE,NDN,ADVH, Wednesday March 11: JA,DRI,GRDG,IO,THI Thursday March 12: GRDG, VTS,PRLS,STGE,RCOT Friday, March 13..AIR Out of the list from last week.. only FPAM was down more than 2 points and that never came into play at all, JA was down but had never been called a play either. AIR had good earnings but so far it is not moving well.. From the rest STGE, KSS, MIKE, ADVH, PRLS, VTS, RCOT, HAZ, HGR, GRDG, IO were good for 1-2 day runs and average rise of over 2 1/2 points each. THI did nicely also. ADVH, PRLS, KSS, MIKE,STGE were extremely profitable and gains reached 4+ points in 1-2 days. GADZ after an upgrade did well, but as FPAM was never a buy. REMEMBER: Earnings plays are successful because they buck the trend.. they go up even as the rest of the market goes down. They don't follow exact technical analysis theory, yet paradoxically you must use TA for your entry points and moving averages are important. TA is important also BEFORE earnings come out, because they can let you know if the stock is overbought/oversold and if you should sell before earnings come out. But once you are in company, or the fundamental analysis is particularly attractive as the case of PRLS and ADVH, I would stay in the play unless your mental stop hits and it didn't in the case of PRLS and ADVH. They had unremarkable technical charts but a turnaround play was apparent in the fundamental outlook. and it is in the classic 'turnaround' that "earnings plays" are the most spectacular. I get these plays from FUNDAMENTAL / TECHNICAL scans but the final determination is from FUNDAMENTAL ANALYSIS. If you are in doubt about a particular earnings play, look at the historic charts of the company and see what happened after the last 2 earnings reports. In most cases, there was a surge in stock if the earnings were good, no matter what the technical chart looked like.