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INVSTR TOPIC: COMPANY RESULTS

by | Feb 11, 2016

Earnings season is the period of time during which a large number of publicly traded companies announce their results. But what does it mean for the financial markets? invstr’s Lea Jakobiak uncovers the definition and why earnings are so important to understand the financial markets.

Video Transcript

LEA JAKOBIAK (Reporter, invstr): There is such a thing as earning season. This is when companies announce  their results on how good or bad they’re doing and for the majority of companies this happens in January, April, July and October usually around 7am. So, first thing in the morning.

BILL BLAIN (Strategist, MINT Partners): The way that the markets work is traders are watching the screens for these announcements and if we take a look at the trading floor here everyone has financial news wires in front of them as these results come in traders very quickly fathom what the results mean and the market very quickly reacts. What you will see happen on any piece of market-moving news an economic number company result is buy and sell orders immediately being executed across the market and can lead to a few moments of frenzied activity on the floor before it settles down again.

LEA JAKOBIAK (Reporter, invstr): Heard of Apple? Thought so. Bill thinks it’s a perfect example to illustrate what happens on the trading floor and it’s not just about what the company announces. It’s about what the market is expecting from that company.

BILL BLAIN (Strategist, MINT Partners): Apple is one of the most successful firms in history their corporate quarterly profits are the highest ever and they are selling billions of units of iPhones. Yet even the suspicion that they were going to post lower than expected sales was enough to cause the stock to wobble and when they eventually announced results that weren’t so strong the market reacted negatively.

LEA JAKOBIAK (Reporter, invstr): And if investors are nervous about the company they don’t beat around the bush

BILL BLAIN (Strategist, MINT Partners): This morning when we’re looking at the bank results as they come out and they’re weaker than expected that causes a massive and immediate sell-off in the price of the stock. What happens is that in a nervous market, investors will find reasons to panic very quickly.

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ALL RIGHTS RESERVED © INVSTR LTD. 2018

Risk Disclosure:
Invstr is a technology platform, not a registered broker-dealer or investment adviser. Invstr does not offer its own recommendations of any security or provide its own research to any user regarding any security transaction or order.
Please note, investing involves risk and investments may lose value. Past performance does not guarantee future results.
Brokerage services are provided by the following:
US-traded securities, including fractional trading, are provided to Invstr users by DriveWealth LLC, a regulated member of FINRA/SIPC. DriveWealth may not establish investment accounts to residents of certain jurisdictions. For more information, including disclaimers, risk and transaction fees click here.
India account traded securities are provided by SIC Stocks & Services PVT Ltd. SIC does not make any personal recommendations to buy, sell or otherwise deal in investments. Investors make their own investment decisions. The services and securities provided by SIC may not be suitable for all customers and, if you have any doubts, you should seek advice from an independent financial adviser. For more information and disclaimers, click here.

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ALL RIGHTS RESERVED © INVSTR LTD. 2018

Risk Disclosure:
Invstr is a technology platform, not a registered broker-dealer or investment adviser. Invstr does not offer its own recommendations of any security or provide its own research to any user regarding any security transaction or order.
Please note, investing involves risk and investments may lose value. Past performance does not guarantee future results.
Brokerage services are provided by the following:
US-traded securities, including fractional trading, are provided to Invstr users by DriveWealth LLC, a regulated member of FINRA/SIPC. DriveWealth may not establish investment accounts to residents of certain jurisdictions. For more information, including disclaimers, risk and transaction fees click here.
India account traded securities are provided by SIC Stocks & Services PVT Ltd. SIC does not make any personal recommendations to buy, sell or otherwise deal in investments. Investors make their own investment decisions. The services and securities provided by SIC may not be suitable for all customers and, if you have any doubts, you should seek advice from an independent financial adviser. For more information and disclaimers, click here.

 

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