Cisco Traders May See Reversal In Shares; Nvidia Likely To Widen
Stocks will kick off their first full week of May with earnings from Walt Disney
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PowerRating), Cisco Systems
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PowerRating) and Lincoln National
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PowerRating), among many other. Investors will also hear the latest reading on unemployment this Friday.
Cisco Systems is slated to report its third-quarter results after the bell Wednesday, and analysts expect the company to report a profit of $0.24 per share, down from $0.38 a year ago, on revenue of $8.1 billion, according to Reuters Estimates. The stock has lost 23.7% over the past 12 months.
In the near-term, the stock has moved to favoring a reversal trend, cutting back or reversing its evening performance in next-day regular session trade in six consecutive quarters. Looking deeper into the performance data, shorts should be interested to know that Cisco has seen a negative post-bell earnings-driven trade in 14 of the 23 quarters we’ve tracked, and in nine of those downside evening moves the stock has followed that trade with a more aggressive negative run in the next day’s regular session.
On the long side, Cisco is about evenly mixed, recording nine earnings-driven upside evening moves in the 22 quarters we’ve followed – widening those gains four times the next day and recording five other events where the gains were cut back or reversed the following day.
Nvidia
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Traders should hold their positions if they are on the right side of the trade in the after-hours. Nvidia strongly favors a widening pattern between its after-hours move and the next day session following an evening earnings event. Shares have widened their next-day price movement in all of the last four sessions. On February 10, the stock fell 2.8% in after-hours trading and widened that move the following regular session, ending down 12.6%.
Cassie Slane is Senior Editor at www.MidnightTrader.com.