Apple Inc. (AAPL) recently reported its earnings on August 3, after the market closed. The stock gapped down -3% at the open the next day and finished down -3.2% on the day. In this blog post, we will examine how this recent earnings move compares to AAPL’s historical earnings move patterns and what history suggests may come next.
Gap Move Comparison
AAPL Historical Stock Price Moves Around Earnings
By analyzing the last three years of earnings data, we find that, AAPL opened lower 58% of the time. This means that it is not uncommon for the stock to gap down after reporting earnings. The -3% decline was only slightly larger than average +/- 2.6% move.
The largest historical move to the upside was +4.1%, while the largest downside move was -3.7%. AAPL’s recent earnings reaction of -3% is within its historical range and demonstrates consistent stock price behavior.
So, What’s Next?
Although it is impossible to be certain about future stock price movement, historical data provides some helpful insights. Over the last three years, AAPL stock fell 73% of the time on the day after reporting earnings, with an average loss of -0.6%. This trend suggests that traders tend to exit bullish positions, which has led to post-earnings weakness. So if history is any guidance, AAPL has a higher chance to fall after earnings and follow suit the next day. Which, at the time of this writing, was exactly what happened.
Conclusion
Based on the analysis of AAPL’s stock movement after earnings from recent and historical price patterns, the recent -3% gap down is only slightly higher than the average (+/-2.6%). Interestly, the stock price declined this time, which was in line with the majority of the outcomes (58%).
Looking ahead, historical data suggested that AAPL could experience some weakness on the day after reporting earnings, as was the case at the time of this writing.
Remember that historical patterns are not guarantees of future performance, and it is essential to consider various factors and conduct thorough research before making investment decisions. As the market is influenced by a multitude of variables, it is always prudent to approach trading and investing with caution and a well-informed strategy.
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Originally Posted August 4, 2023 – AAPL Historical Earnings Moves and What Does History Suggest?
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