this looks ominous - http://www.bnamericas.com/sector_home.jsp?sector=11&idioma=I¬icia=392097 their latin america branch was down.
Take it easy with the rock. It's a Dow component. At the most it will move 10%. They would have to blow estimates out of the water to even justify such a radical move.
ehh.. it only beat the estimates by 2.5%. Could you please tell me how I can research the sec filings to see who bought a particular stock?
I think the adjusted net income is the figure which is more important since it doesnt include one-time costs, and is a better indicator of the companies performance for the quarter. Using this figure, it looks like they beat estimates by closer to 9% or so. And they are down in after-hours trading, makes absolutely no sense.
Hydro Thanks for that very informative post. Care to explain why a huge company like AIG posts a quarter over quarter profit increase of 25% and also beats estimates in every way possible, only to trade lower? I will repeat, this does not make any sense. And i think this stock will trade upwards on the good news in the next couple days even though it is down slightly in after hours trading.
If you go back through the last ten years of trading, the P/E of AIG has never been lower and the EPS has never been higher. Now, after this earnings report, the P/E will even be lower and the EPS yet higher approaching oil company-like levels. Clearly, the firm is growing. Its been growing for the last few years and a higher P/E is justified. Dont forget. The selloff in afterhours was only 315k and this stock trades at 10 million in volume everyday. 3-4% of the daily volume. Hardly a strong selloff. Im pounding my fists. In this environment where everyone is saying buy large caps and here we have a company that beats analysts estimates and trades at very low ratios (lower then in any period during the last 10 years), this has to go higher from here. The float is 2.6 billion shares. The bad news is that once this stock starts sailing in a direction then its hard to turn it around on any news. The good news is that once this stock starts sailing in a direction then its hard to turn it around. Its a two way street. If it starts sailing up, then it will continue up until it hits a ceiling. If it starts sailing down, then your going to wait months for it to come back up. So if the stock trades above 73 at some point, then I will be convinced we can go higher. Also notice where the stock stopped in afterhours. 71.68 is the 5 day moving average which it has been traveling up for a while now.
1. AIG trades at a higher P/E than comparables. That should hint to you that it's priced in. 2. The profit increase was expected & projected. Hence, priced in. This is capitalism, perpetual growth is almost required. 3. AIG is a DOW COMPONENT. That means it is analyzed to death. One time charges or not, they were considered cause these insurance companies tend to have a lot of one time charges. It is very hard for AIG to suprise the street, it is a very heavily covered company. 4. Beating by 2.5% means little unless there is a strong forecast of even greater success, like increased estimates & pro formas. 5. AIG is taking a charge related to sub-prime. That's enough to have some institutions dump it at these high prices 6. It's a $70 dollar stock that is down a measly .5% in aftermarket. It's a hiccup for all you know. It's probably not going to do much at all. If some fund decides to buy into it, they are gonna span it out cause NOTHING in that report justifies buying it up ASAP. I've said this before to you, understand earnings reports and how they work before making the statements you do. There are a number of things stated in AIG's report which can be viewed as bad signs for future quarters. And that's what it's all about. The next 2-3 quarters, not the current one.
Hydro Excellent post, it's refreshing when I come accross something worth reading on this site. The point I was making is that a stock with this type of upwards momentum should be trading higher after such possitive earnings reports. And frankly it caught me by surprise to see it trade lower in AH trading, especially after it spiked up sharply in the last half hour of the day, where the smart money usually is. And yes, this company may be highly analyzed by many firms on and off the street, but you know what? None of that matters until the actual accountants crunch the numbers and come up with a top and bottom line for the quarter. So no matter how good the analysis of the company is, anything can happen. A company can easily miss the estimates put forth upon them by the analysts, just like a company can do better than what was thought of them. And when AIG beats what was expected of them, I expect them to continue trading higher. And I disagree with the markets being as efficient as you paint them to be.