If there’s anything that illustrates what makes Wall Street tick, it’s looking at the stock reaction to the earnings reports from Apple Inc. AAPL -10.88%and Netflix Inc. NFLX +37.52%
It’s just a trading opportunity. It’s just an inning in the game.
Apple earned $13.1 billion in the quarter and Netflix earned $8 million. One stock was up 34%, the other was down 10%. Care to take a guess as to which is which?
The reaction says much more about the Street than it does about either company. The key thing is expectations. Netflix was expected to lose money, and indeed the Street was clearly betting that it would do just that. When it posted that slim $8 million profit, the shorts got caught, and the stock rocketed higher.
In the end, it’s not about the earnings themselves. It’s about a trading opportunity. It’s about an inning in the game. It’s about trying to figure out how the other guy on the Street is going to respond to the earnings, and to either get in or out ahead of him.
Grade that sums it up quite well, we are stuck in the dug out until we get a pitch and it is good to left field ie China Mobile deal, or new product like iwatch, large screen iphone, iphone a la emerge markete, and of course the iTV would be a homerun! all the above we get a grand slam!! oh brother.............