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alpha-DNA: Earnings Season is in Its Busiest Window

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This week and next week provide the busiest earnings cycle especially for mid and small cap companies. So far, earnings season has not provided the weakness that many analysts feared. Companies continue to beat on EPS across the markets. In the broader markets, revenue beats are also occurring though not as frequently as EPS surprises.

For our investments, we have proven strong in both EPS and Revenue surprises. We had 18 more stocks in our bullish portfolio announce this week. 17 out of 18 beat on EPS expectations and the 18th stock met its EPS expectation. On the revenue side, only one company had a material miss on Revenues. In fact, the average revenue profile has looked strong. In the Beats, Meets, and Miss categories, the average revenue surprise was +4.7% for Beats, +0.3% for the Meets, and just -1.0% for the Miss. We definitely like that kind of revenue surprise stratification.

This week brought back stronger forward guidance among our 18 stocks. We had seven stocks provide upward forward guidance and only three provide downward forward guidance. That 2:1 ratio is what we strive for on guidance! We also strive for over 80% success in calling each of EPS and Revenue and we are on track to surpass that so far this quarter through this week!

The report can be accessed from the link below! As usual, you want to see green on the report as that indicates our bias towards the surprise was achieved.

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