When an organization the scale of Palo Alto Networks (NASDAQ:) confirms a Friday after-the-bell earnings date, we listen, particularly when it’s by no means reported at the moment earlier than.
At Wall Avenue Horizon we’re all the time looking out for firms that affirm outlier earnings dates, and whereas that is an outlier so far as day-of-the-week is worried, the precise date in query is simply barely sooner than when PANW would sometimes report.
Palo Alto Networks FQ4 2023 Report Date
Palo Alto Networks has reported fiscal This autumn outcomes from 8/22 – 8/24 for the final three years, on a Monday after market shut (AMC). The prior seven years of studies had been a lot later, from 8/30 – 9/9, with no day-of-the-week pattern.
As a result of 3-year pattern, we had assumed a report date of Monday, August 21 AMC. As an alternative, on August 2 PANW confirmed they’d report August 18 AMC, the primary ever Friday report since they IPO’d in 2012.
An Try to Conceal Unhealthy Information?
It’s been a well known tactic for years that firms attempt to conceal their unhealthy earnings studies throughout occasions when there’s much less market consideration. That sometimes means busy days, after hours, and Fridays. It is sensible that buyers can be paying much less consideration to the markets on a Friday afternoon simply as they’re kicking their sneakers off for the weekend. Nonetheless, the 2015 educational paper “Market (In)Consideration and the Strategic Scheduling and Timing of Earnings Bulletins” by Ed deHaan of Stanford College, discovered utilizing Wall Avenue Horizon information that whereas there’s truly much less consideration on busy days, after hours, and when an organization confirms with much less advance discover, consideration doesn’t essentially wane on Fridays.
Market Consideration Measures
Supply: Market (In)Consideration and the Strategic Scheduling and Timing of Earnings Bulletins, Ed deHaan, et al
However regardless that investor consideration remains to be intact on Fridays, the analysis reveals that earnings reported after hours, on busy days, and even on Fridays, are considerably worse (relative to Wall Avenue expectations) than at different occasions. As a result of this appears to be the case, even asserting a Friday AMC report date dings a inventory, simply as we’ve seen with PANW. Since confirming their FQ4 2023 report date on August 2, the inventory has fallen ~15%.
Friday Afternoon Earnings Experiences – A Rarity for Giant Caps
How uncommon is a Friday AMC earnings report? Simply to place it in perspective, for the second quarter earnings season we screened for firms with market caps over $10B and located that along with Palo Alto Networks, solely Toronto-based Constellation Software program (CSU) confirmed a Friday AMC date. Constellation reported on August 11, and it was the second time of their xx years as a public firm that they reported at the moment. They did certainly have some unhealthy information to share, which got here within the type of an 18% YoY revenue decline. Since their report, the inventory has fallen 3%.
Supply: Wall Avenue Horizon
Latest Cybersecurity Outcomes
The very subsequent day after PANW confirmed their odd earnings date, peer cybersecurity identify Fortinet (NASDAQ:) reported quarterly outcomes that missed income expectations and warned that offers had been being delayed on account of macroeconomic uncertainty. Fellow cybersecurity names, together with PANW, noticed their shares fall because of this. Extra just lately, on August 14, Cyberark Software program Ltd (NASDAQ:) reported better-than-expected outcomes for the quarter, lifting cybersecurity shares.
On Friday we’ll see whether or not PANW will go the way in which of FTNT or CYBR and whether or not there was something to their Friday AMC report date.