forbes.com
Alphabet's Earnings: 55% Chance of Positive One-Day Return
Alphabet's upcoming earnings announcement on April 24, 2025, is anticipated to report $89.2 billion in revenue and $2.03 EPS, exceeding last year's figures; historical data shows a 55% chance of a positive one-day return post-earnings, although this probability decreases to 42% considering the last three years.
- How does the correlation between Alphabet's short-term (1-day) and medium-term (5-day and 21-day) post-earnings returns inform trading strategies?
- Over the past five years, Alphabet's stock saw a median one-day gain of 5.6% in 11 out of 20 post-earnings events, reaching as high as 10% in a single day. However, this positive trend weakens to a 42% probability when considering only the last three years. The correlation between short-term and medium-term returns offers another trading strategy.
- What is the likelihood of a positive one-day stock return for Alphabet after its upcoming earnings announcement, and what specific historical data supports this?
- Alphabet, with a $1.9 trillion market cap, is expected to report $89.2 billion in revenue and $2.03 EPS on April 24, 2025. This surpasses last year's $80.5 billion in sales and $1.89 EPS. Historically, Alphabet's stock has shown a 55% chance of a positive one-day return after earnings announcements over the past five years.
- Considering the inherent volatility of individual stocks like Alphabet, what alternative investment options provide comparable or superior returns with reduced risk?
- While past performance is not indicative of future results, the historical data suggests a moderate risk-reward profile for short-term trading around Alphabet's earnings. Analyzing correlations between 1-day, 5-day, and 21-day returns can refine trading strategies, reducing volatility. For investors seeking lower-risk alternatives, the Trefis High-Quality portfolio, with over 91% returns since inception, offers a compelling contrast to single-stock volatility.
Cognitive Concepts
Framing Bias
The article frames Alphabet's upcoming earnings announcement primarily through the lens of short-term trading opportunities. The headline and introduction emphasize potential price movements and trading strategies, potentially influencing readers to focus on short-term gains rather than the company's long-term prospects. The repeated mention of the Trefis portfolio throughout the article further reinforces this bias.
Language Bias
The article uses language that is generally neutral but occasionally leans towards promoting short-term trading. Phrases like "event-focused traders" and "pre-earnings trading strategies" subtly push readers towards a specific investment approach. The description of the Trefis portfolio as an "appealing option" is also slightly promotional.
Bias by Omission
The article focuses heavily on short-term trading strategies around Alphabet's earnings announcement, omitting discussion of long-term investment strategies or the company's broader fundamental performance. This omission could mislead readers into believing that short-term trading is the primary or only way to approach Alphabet's stock. It also fails to address the risks associated with short-term trading, potentially leading to uninformed decisions.
False Dichotomy
The article presents a false dichotomy by suggesting that investors must choose between high-volatility single-stock trading or the Trefis High-Quality portfolio. It doesn't consider other diversified investment strategies or approaches to managing risk.
Sustainable Development Goals
The article discusses Alphabet's strong financial performance, including substantial revenue and profit figures. This positive economic activity contributes to decent work and economic growth, as it reflects a successful and large company contributing to the economy and employing numerous people. The discussion of earnings and potential investment strategies also relates to economic growth and market activity.