During earnings season I have noticed that some of the 150 stocks I am following have had very large drops in the share price once earnings are announced that did not meet analysts' expectations. These are quality companies that have great products and a long history of making money. Though for one reason or another their earnings this quarter did not meet analyst's expectations.
In my years of following the stock market, I find individual stocks and the entire market itself tend to overreact to both good and bad news. Once investors calm down and determine that the company that did not meet analysts' expectations is still making lots of money, has great products, and has a profitable future, the share price quickly recovers.
Is there any statistical analysis about the probability of a stock recovery after a huge drop in share price after an earnings miss?
Submitted August 06, 2021 at 09:07AM by rarelywearamask https://ift.tt/3fFsrAS
