Whisper Number: How Will Wells Fargo Investors React to Earnings?

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Wells Fargo (NYSE:WFC) is expected to report earnings on Friday, April 11. The whisper number is $0.98, two cents ahead of the analysts’ estimate. Whispers range from a low of $0.94 to a high of $1.00. Wells Fargo has a 39 percent positive surprise history, having topped the whisper in 15 of the 38 earnings reports for which we have data.

Earnings history:

- Beat whisper: 15 qtrs
- Met whisper: 0 qtrs
- Missed whisper: 23 qtrs

Our primary focus is on post earnings price movement. Knowing how likely a stock’s price will move following an earnings report can help you determine the best action to take (long or short). In other words, we look at what happens when the company beats or misses the whisper number expectation.

The table below indicates the average post earnings price movement within a one and thirty trading day timeframe.

WFC414A

The strongest price movement of +8.2 percent comes within ten trading days when the company reports earnings that beat the whisper number, and +2.6 percent within five trading days when the company reports earnings that miss the whisper number. The overall average price move is ‘positive’ (beat the whisper number and see strength, miss and see strength) when the company reports earnings.

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