A 6% One-Day Jump?

Buckle up for third quarter earnings season... [Wealthy Retirement]( SPONSORED [Could This Tiny Box Power Your Home?]( [60 Minutes]( It doesn't require sunlight. It doesn't require wind. It doesn't require power lines connected to a coal or nuclear plant. [Find out why the billionaire lead investor behind Google and Amazon is calling it "the largest economic opportunity of the 21st century."]( Editor's Note: In today's Wealthy Retirement, Chief Income Strategist Marc Lichtenfeld pulls back the curtain on one of the market's most powerful profit opportunities: earnings announcements. These updates - and even the expectations set for them - can be powerful catalysts that push stocks higher, sometimes creating dramatic one-day spikes. And as Marc writes below, this particular earnings season is special. In fact, it's the most important one of our lifetimes. With COVID-19 not quite in the rearview mirror and the election creeping up, companies are in a position unlike any they've ever faced before. But along with heart-wrenching losses come spectacular chances to score big... And at his free [Blockbuster Earnings Season Kickoff]( on October 21 at 1 p.m. ET, Marc will show you exactly how to play the earnings game - and win. [Click here]( to sign up - and to learn how Marc's strategy could triple your investment in three months. - Mable Buchanan, Assistant Managing Editor [FINANCIAL LITERACY]( How to Play the Earnings Game Marc Lichtenfeld, Chief Income Strategist, The Oxford Club [Marc Lichtenfeld] I don't really pay attention to my long-term investments on a day-to-day basis. These are companies I plan on holding for years, so if they move a couple of percentage points in a day, it's not particularly noteworthy. However, for shorter-term investments and trades, I do keep close tabs on them, waiting for a catalyst to cause a sharp move higher. In fact, I never enter a trade unless I have an idea of what should move the stock. It could be an upcoming [earnings report]( an important corporate announcement or even a technical breakout on the stock chart. Earnings reports are one of my favorite expected catalysts. Companies report results every quarter, so you have four times per year when a stock has potential for a strong move. What's interesting about earnings and stocks' reactions to them is the company doesn't necessarily have to make loads of money. All it has to do is beat expectations to see its stock move higher. A company may be expected to lose $0.10 per share. If it reports a loss of $0.05, you could see a big jump in the stock price even though the company lost money. Other times, you see share price spike on guidance. A company may have matched or even missed analysts' estimates for the past quarter, but if it raises guidance (what it tells Wall Street to expect going forward) for the current quarter or the full year, that may be the catalyst you've been waiting for. SPONSORED [Trump Celebrates 50,000 New American Jobs!]( [Trump with Finger to Ear]( A $10 billion deal... Donald Trump, America's No. 1 tech company and one $3 secret stock could send shockwaves across America... [Story here.]( Earnings is a bit of a game for companies and Wall Street analysts. Analysts base their expectations on the guidance given to them by CEOs. These executives purposefully don't raise the bar too high so they can beat expectations and be heroes. Wall Street typically doesn't want companies to miss - especially when it has "Buy" ratings on the stocks - because that makes the analysts look bad. It also makes the companies look bad, and the analysts want the CEOs to be happy with them so they'll consider the analysts' firms for their investment banking needs. If you're an analyst and you publish sky-high estimates that a company misses and then write a negative report because the company failed to meet your expectations, good luck getting that company to use your firm on its next bond offering or acquisition. Despite this well-orchestrated dance, stocks can and often do move significantly when companies beat earnings expectations and [can also fall hard]( when they miss. Cisco Systems (Nasdaq: [CSCO]( is an example of a company whose management knows how to play the game and win. It has beaten analyst expectations in each of the past nine quarters. And the stock has benefited, as it averages a 6% one-day jump on those days it beats earnings. Over the next few weeks, we'll see many stocks react to earnings reports. Third quarter earnings season starts on October 21. Expectations aren't high. S&P 500 companies are forecast to see a 21% drop in earnings for the quarter. It is the largest decline since the Great Recession in 2009. With the outlook so poor, that could lead to very large moves in stocks that issue upside surprises. It's important to understand the factors that could move your stocks in the next few weeks. Third quarter earnings will most definitely be one of them. Buckle your seat belts. The next few weeks should be a wild ride. This rare decline presents once-in-a-lifetime opportunities for investors who play their cards right. If you want to beat the earnings game, consider signing up for my free [Blockbuster Earnings Season Kickoff]( event on October 21 at 1 p.m. ET. I'll arm my viewers with the insight needed to avoid the market's disappointments... And cash in on its biggest wins. [>>Click here now to register.<<]( Good investing, Marc [Leave a Comment]( MORE FROM WEALTHY RETIREMENT [Profit No Matter Who Wins the Election]( [What to Do When Insiders Say "Buy"]( [Bill Ackman's Trade of the Century]( [Facebook]( [Facebook]( [Twitter]( [Twitter]( [Email Share](mailto:?subject=A%20great%20piece%20from%20Wealthy%20Retirement...&body=From%20Wealthy%20Retirement:%0D%0A%0D%0A Buckle%20up%20for%20third%20quarter%20earnings%20season... %0D%0A%0D [Email Share](mailto:?subject=A%20great%20piece%20from%20Wealthy%20Retirement...&body=From%20Wealthy%20Retirement:%0D%0A%0D%0A Buckle%20up%20for%20third%20quarter%20earnings%20season... %0D%0A%0D SPONSORED [This Could Be Your DO-OVER on the Most Profitable Market Recovery of All Time...]( [Explosive_Recovery]( Did you have the courage to get in at the bottom of the real estate market in 2009? Most folks didn't... But today you have the chance at a DO-OVER. 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