Google and why you should keep tabs on the Earnings date?

Out of the 10 largest companies in terms of market capitalization, 6 of them are technology companies. This just goes to show the power that the internet holds in our lives, and the effect it has on the economy. Among these companies, few are as strong on the market as Google or Alphabet Inc. as it is known as now.

The company was founded in 1998 by two computer engineers, Larry Page and Sergey Brin. The company had humble beginnings and since then has grown to quite an extent. Last year the Alphabet Inc. posted profits of over 110 billion dollars and also marked the first time in their history where they crossed 750 billion dollars in market capitalization. Today that number is close to 830 billion and is steadily rising towards 1 billion. Unlike other companies such as Apple and Amazon on the list, Google’s focus lies heavily on software rather than hardware.

The recent trends have seen them shift that focus towards the hardware side of things. But it is their impeccable software which continues to be the backbone of the company. Since its debut on the stock markets, the company’s shares have seen a very strong rise in value. As we approach the earnings date GOOG for this year, it might be a wise idea to keep a close eye on how the prices will rise and drop.

What is a PMAEA and how will it help?

Like any stock option on the market, GOOG is being closely monitored by experts who have to give in a preview of what the performance will be like on earnings date announcement day. This preview is called a PMAEA or a Predicted Move after Earnings Announcement, and it gives a rough value of the expected rise or drops in the stock price after the earnings date announcement.

More often than not, the predictions are quite spot on. The reason is that the people who predict these numbers often factor in various metrics such as company fundamentals, historical reaction after the announcement, supply and demand activities, and the peer reaction after the announcement.  These values tend to form a pattern over time and with the right amount of information can often help predict what the next figures might look like.

Why should you focus on these numbers?

If you happen to be a day trader or even are just keeping a close eye on the shares and prices of the stock and waiting to make your move, tracking the PMAEA can be of great benefit. The predicted move this time is around 5% and thus the strike price can be set at 10%. If in case it touches the strike price, you should immediately purchase the stocks.

If you plan three odd weeks ahead, you can strategize your move and put yourself in a position where you are likely to get the shares for a good value. Doing this not only solidifies your position as a shrewd investor but also helps you secure a good portfolio.