request: how does a company’s stock rise/fall so quickly immediately after earnings?
In: 0
Stocks represent ownership in a company. The value of a company is very heavily based on its earnings and profit, so when earnings are released, it can have a large impact on what people think the company is worth.
It’s also worth nothing, that the price will change based on reality vs expectations. Let’s say the expectation is that a company will lose 100 million. The current stock price would reflect those general expectations.
If they announce they only lost 50 million, the stock price would go up, because losing 50 million is good news, when you are expecting to lose 100 million.
Latest Answers