Will Abbott Labs Top The Whisper Number This Quarter?

Abbott Laboratories (ABT) is expected to report earnings on Wednesday, January 25th, before market open. The whisper number is $0.68, three cents ahead of the analysts' estimate and showing some confidence from the WhisperNumber community. Whispers range from a low of $0.65 to a high of $0.71. A year ago the company reported earnings of $0.62. Abbott has a 47% positive surprise history (having topped the whisper in 23 of the 49 earnings reports for which we have data).

Earnings history:

•  Beat whisper: 23 qtrs
•  Met whisper: 4 qtrs
•  Missed whisper: 22 qtrs

Our primary focus is on post-earnings price movement. Knowing how likely a stock's price will move following an earnings report can help you determine the best action to take (long or short). In other words, we analyze what happens when the company beats or misses the whisper number expectation.

The table below indicates the average post earnings price movement within a one and thirty trading day timeframe:

The strongest price movement of +0.6% comes within 20 trading days when the company reports earnings that beat the whisper number, and -1.1% within 30 trading days when the company reports earnings that miss the whisper number. Although the strongest price moves are as expected, the overall average post earnings price move is 'negative' and limited (beat the whisper number and see weakness, miss and see weakness) when the company reports earnings.

The table below indicates the most recent earnings reports and short-term price reaction:

The company has reported earnings ahead of the whisper number in one of the past four quarters. In the comparable quarter last year the company reported earnings three cents short of the whisper number. Following that report the stock realized a 4.4% loss in one trading day. Last quarter the company reported earnings one cent short of the whisper number. Following that report the stock realized a 6.5% loss in 30 trading days. Overall historical data indicates the company to be (on average within 30 trading days) a limited and 'negative' price reactor when the company reports earnings.