by Larry Swing - October 16, 2005

Education

A recent study by Jeffrey Doyle, Russel Lundholm, and Mark Soliman explored stock price movements after earnings surprises.  Unlike most prior studies that used seasonally unexpected earnings or another similar benchmark, this study focused on earnings surprises from analyst consensus.

The authors found that stocks which had the most positive surprises substantially outperformed the stocks with the most negative surprises.  The average difference between stocks in the best decile and the worst decile was 13.95%.

Reference:

Doyle, Lundholm, and Soliman.  2004. "Extreme Earnings Returns to Extreme Earnings Surprises."

Analyses of ETFs

BBH:  Neutral.  (Biotechnology)

BDH:  Neutral.  (Broadband)

BHH:  Neutral.  (Business to Business)

EKH:  Neutral.  (European Stocks)

HHH:  Neutral.  (Internet)

IAH:  Neutral.  (Internet Architecture)

IIH:   Neutral.  (Internet Infrastructure)

OIH:  Neutral.  (Oil Services)

PPH:  Neutral.  (Pharmaceuticals)

RKH:  Neutral.  (Regional Banks)

RTH:  Bullish.  (Retail)

SwingTracker
MrSwings Real-Time Stock Charts RISK-FREE TRIAL featuring one-click access to Larry Swing's profit-generating indicators - Force Index, EquiVolume, True Strength Index

SMH:  Neutral.  (Semiconductors)

SWH:  Neutral.  (Software)

TTH:  Neutral.  (Telecommunications)

UTH:  Neutral.  (Utilities)

WMH:  Neutral.  (Wireless)

QQQQ / SPY / DIA:  Bulllish