EarningsBeats Digest

Published: Mon, 04/18/22

EarningsBeats.com Digest for April 18, 2022

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Q1 Earnings (Sneak Preview)

Monday, April 18th at 4:30pm ET

As the initial quarterly earnings reports are released, EarningsBeats' Chief Market Strategist Tom Bowley will be there to separate the good, the bad, and the ugly. In addition, Tom takes a look ahead to upcoming earnings reports to identify stocks that he expects will post blowout numbers.

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Relative Strength Plus Strong Accumulation Suggests Big Earnings

Last week, Unitedhealth Group, Inc. (UNH) entered the week with perhaps the strongest charts among all companies reporting quarterly results. And they easily beat both revenue and EPS estimates. The absolute price action after earnings was mostly neutral, but the strong pre-earnings run was accompanied by a rising AD line and that's what I really look for heading into an earnings report. Of the 135 companies on our Upcoming Earnings Relative Strength ChartList for this week, several stand out to me as likely blowout reports (and I'll discuss them at tonight's "Sneak Preview: Q1 Earnings" webinar). But there's one I'd like to feature right now and it's Halliburton Co (HAL):

HAL reports Tuesday morning and, if its chart is any indication, get ready for a blowout. Wall Street loves HAL. HAL has doubled its share price over the past 4-5 months and the strength has been accompanied by heavy volume. HAL's AD line has mirrored its price chart - straight up. The oil equipment & services industry ($DJUSOI) has been one of the strongest in 2022 and HAL is a leading stock within the group. Having said all of this, I do think HAL could be subject to "buy on rumor, sell on news." The PPO suggests that price momentum is slowing, so once the news is out, don't be shocked if HAL sees a period of selling/consolidation. I'd look at that period as an excellent buying opportunity, especially if HAL tests its 50-day SMA.

Happy Trading!

Tom Bowley
Chief Market Strategist

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