Earnings in Focus: The Week Ahead

February 13th – February 17th

Each week, I dwindle the extensive list of companies reporting earnings to focus on a much smaller list in which I look for trading opportunities.
The companies that fit within my focus list must:
  • Must trade in the options market
  • Must have weekly options series available (if not, the earnings report falls in the week of monthly options expiration)
  • Be high-interest companies that funds, retail, and the media have a high focus on
  • Have a couple of hundred contracts of volume + open interest in the delta .70 to delta .30 strikes
  • Have data-specific setups based on past earnings patterns
  • Have confluence with an additional trading setup pattern I use, such as a short squeeze, squeeze, head & shoulders, etc.
  • A solid macro backdrop that makes sense

Looking forward to next week, here are a couple of tickers I have on my shortlist.

 

Tuesday:
Coca-Cola (KO)
Zoetis Inc (ZTS)
Airbnb (ABNB)
Akamai Technologies (AKAM)
AMMO Inc. (POWW)
Upstart (UPST)
Wednesday:
Generac Holdings (GNRC)
Krispy Kreme (DNUT)
Roblox (RBLX)
Cisco (CSCO)
Fastly (FSLY)
RingCentral Inc. (RNG)
Roku (ROKU)
SunPower (SPWR)
Trupanion (TRUP)
Upwork (UPWK)
Zillow (Z)
Thursday:
Crocs Inc. (CROX)
Datadog Inc. (DDOG)
Applied Materials (AMAT)
DoorDash (DASH)
DraftKings Inc (DKNG)
Dropbox Inc (DBX)
Hubspot (HUBS)
Friday:
John Deere (DE)
Even though we have made it through the core of earnings season, there is still plenty of opportunity for earnings-based trades!

Earnings Preview

 

Roku

Let’s take a look at Roku. Roku is a highly volatile stock on earnings. Over the last 12 quarters, it has beaten estimates nine times; however, as you can see in the screenshot below, those numbers didn’t impress the market. Roku has fallen 5/8 quarters post-earnings, and it’s also fallen 6/8 going into earnings. Not only has it fallen, but it’s fallen substantially, with moves up to -26%.

 

Roku is a wild one to trade, but it also displays consistent patterns.

 

John Deere (DE)

John Deere is a stark contrast to Roku’s movements and results. The company has beaten estimates in 11/12 quarters and traded higher in 9/12 quarters post-earnings. While ROKU lost the majority of shareholder value last year, DE made a new, all-time high, despite downward moves in 3/4 quarters post-earnings. John Deere also trades within a relatively predictable range, unlike Roku.


 

Earnings Trades

What are you eyeing for earnings next week? I’ll be joining Kelly Evans on CNBC’s The Exchange on Wednesday, February 15th, for one of my favorite segments, Earnings Exchange. We’ll cover three tickers, and note how I’m trading them.

Check out the segment on CNBC, or follow me on Twitter @traderDanielle to catch the replay!

You can also find me in the Options Gold Room on Tuesdays & Wednesdays from 1-2 pm.

 

 

 

 

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