If you watched last night's episode of 'Billions' on Showtime, you would have seen the Axe Capital trader Donnie Caan wearing a concealed microphone and recording device into work. The U.S. Attorney's Office suspected Donnie of insider trading and the only way he could keep himself out of jail was to capture evidence of his boss Bobby Axelrod committing a similar act.
For the past couple weeks I've been writing on this blog and in our newsletter about FDA drug approval dates (PDUFA dates) and the impact that these catalysts can have on a drug manufacturer's stock price. This week I thought I would let our partner Informa do most of the talking. And why not, considering their opinions successfully predicted 75% of the catalyst outcomes that occurred in Q4 2015!
Last week we announced a partnership with Informa to make FDA drug approval dates, also known as PDUFA (Prescription Drug User Fee Act) dates, available to clients through our new online application, Enchilada™. If you invest in or trade biotech stocks, chances are you know a lot about PDUFA dates. If you don't, let me start this blog post with a PDUFA 101 . . .
While our focus at Wall Street Horizon is on giving our clients the most accurate and up-to-date corporate event dates, we also maintain ten years of history on other event related information such as earnings per share, dividend payments, etc. As such we often times analyze this related information to see if we can spot trends that may help our clients with their investing/trading strategies or help our operations team fine tune their procedures for tracking down accurate event dates.
Wall Street Horizon earnings dates are the most accurate available. There, I said it. Over the past month or two on this blog I have tried creative ways to make that point but today I figured I would stop beating around the bush and just give it to you straight. I also wanted to reinforce why investor conferences are such important corporate events, and why investors, traders and investor relations professionals should also pay close attention to them and the companies that are presenting.
One week from today (Thursday, January 14) and before the markets open, J.P. Morgan will 'unofficially' kick-off the earnings season when it announces its earnings and hosts its conference call. If you recall from last quarter, much ado was made out of the fact that J.P. Morgan scheduled its Q3 earnings announcement for after market hours, instead of before the market opened, as it had done every quarter since at least 2Q 2005.
Those who trade off of corporate events know that when a company delays the release of their earnings it's typically because there is bad news to report.
If you have been reading this blog for the past month or so, or are well versed in the academic research on the subject, you would know that there is some science (and some art) around when companies will release their quarterly earnings.
As of today, approximately 94% of the companies that Wall Street Horizon tracks have announced their earnings for this quarter. What may surprise you however is that only 85% of these companies were announcing their fiscal Q3 2015 results and only 87% had a fiscal quarter end date of September 30, 2015.
Given that companies are not required to host a conference call or webcast to discuss their quarterly financial results, I wondered whether there were any companies that might host a call when the company had good news to report, and not host a call when the company had bad news to report. Here is what I found when looking at the behavior of 978 Fortune 1000 companies going back eight quarters to Q3 2013 . . .