This should further be supported by ongoing result season where any earnings surprise
and/or announcement of bonus/cash dividend may generate investors' interest in select scrips.
Slowing inflation could boost spending and margins that could trigger a corporate earnings surprise
and drive the Philippine stock index to 8,900 this year, according to Jody Santiago, Manila-based strategist at UBS AG.
For example, a firm which reports a high earnings surprise
(good earnings news) and is within 100 miles of a city with a losing team will exhibit a 9% to 10.5% higher post-earnings announcement drift.
"The company delivered average positive earnings surprise
of 50% in the trailing four quarters," Ganguly says.
Their study, "Evidence of a Positive Trend in Positive Quarterly Earnings Surprise
over the Past Two Decades," involved analyzing hundreds of thousands of earnings reports from approximately 4,700 companies.
It pulled off an average positive earnings surprise
of 10.4% in the last four quarters.
Market analysts say it is no question that Samsung's memory chip business was the top contributor to help the company see an "earnings surprise
." The division was estimated to report an operating profit around 11 trillion won, accounting for about 75 percent of the total operating profit it generated during the quarter.
However, it is not a wise decision to sell uptrend markets; speculation might continue to drive stocks higher, especially if earnings surprise
to the upside.
Michael Kors reported a positive earnings surprise
of 2.1 percent in the last quarter.
It was an earnings surprise
as it sharply surpassed market expectations of about 5.2 trillion won.
The big earnings surprise
was flagged last week, when the company warned it would take a pre-tax charge of USD$350 million to USD$400 million and confirmed it was putting its troubled wing-construction facilities in Oklahoma up for sale.
The results are unlikely to trigger any market reaction, in our view, unless the company manages to produce an earnings surprise