Jim Kramer of CNBC reminded investors to always listen to a company’s conference call before trading on earnings and to avoid trading after hours.
“A mistake in after-hours trading will erase you much faster than a mistake in regular time when everyone has the same information. There are more bids and offers and the playing field is more or less the same,” said the host.
Kramer also listed three examples of companies that reported earnings on Tuesday, leading investors to make regretting after-hours trading decisions with disappointing results.
Here are three keywords outlined by Kramer:
Micron reported better-than-expected earnings and revenue and provided a rosy outlook for its latest quarterly results. While the stock jumped more than 4% in after-hours trading on Tuesday, it fell 3.52% on Wednesday.
According to Kramer, the company’s comments in a conference call about how the Kovid outbreak in China has affected manufacturing production and how Russia’s invasion of Ukraine could disrupt Micron’s supply chain could be a catalyst for a decline.
“Micron quarterly wasn’t bad.… But if you try to chase this stock in after-hours trading at $ 86, you’ve paid a lot more than you need,” he said.
The Athleticwear apparel company reported better-than-expected earnings but lower revenue in its most recent quarter. Lululemon also announced a $ 1 billion stock buyback program. The stock rose nearly 7% in after-hours trading on Tuesday but also had a “flash crash,” Kramer said.
He believes there was confusion about the criminal Lululemon’s total comparative sales and estimates for its comparative-store sales, as well as the company’s comments in a conference call that sea freight delays are creating more reliance on aircraft cargo.
Lululemon stock rose 9.58% on Wednesday.
“If you sold the stock last night for 345, you’re kicking yourself today,” Kramer said.
RH (Previously recovery hardware)
RH reported an earnings beat and announced a stock split for three for the spring but missed revenue. Kramer said CEO Gary Friedman’s comments on how rising inflation and Russia’s aggression in Ukraine are slowing down business-fearing shareholders.
RH stocks fell 13.33% on Wednesday.
“As much as I like stock splitting, none of these things matter if the underlying business is struggling,” Kramer said.
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