A good earnings report can provide a needed boost to a company’s share price. At least that is what logic tells us. But it’s not always the case.
A company can report positive earnings but fail to meet analysts’ expectations — like reporting $1.50 in earnings per share (EPS) when analysts expected $2.
Another instance where good earnings won’t translate to positive stock movement is if the company lowers its guidance for revenue or earnings in future quarters.
Today, I’ll break down the S&P 500 and show you an anomaly between stock prices and the latest round of company earnings. Then I’ll tell you why it pays to dig deeper into earnings reports before trading.
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