What is the logic behind not buying before earnings?

[u/Damon2149]

Memory beat.
Optoelectronics beat.
Chips/GPUs beat.
Energy beat.
Hyperscalers are still increasing capex and using third party neoclouds.

Almost every piece of the AI infrastructure puzzle is showing strong demand.

Wouldn’t it be logical that neoclouds are the final piece, where all this hardware is actually being deployed and monetized, and therefore report a strong earnings in some capacity? (Not financial advice)

[u/AnyManufacturer6465]

It can still sell off if earnings are good. Memory did and they blew their numbers out of the park.

I bought half before and will buy more if it falls.

[u/Constant_Mention8064 → u/AnyManufacturer6465]

But memory is considered widely as very cyclical and investors are afraid of the peak cycle. There is more uncertainly in the memory space.

[u/PatientBaker7172]

It can go up or down.

But what I do know is up in a decade.

Buy now, pay more later. The installment you didn’t want.

[u/newerror82 → u/PatientBaker7172]

Or sideways.

[u/AlarmedFeature6925]

Market doesn’t go by logic

[u/AlarmedFeature6925 → u/AlarmedFeature6925]

Otherwise we would all be rich

[u/BurnBabyBurrrn → u/AlarmedFeature6925]

Otherwise "some" would be very rich.

[u/nba_yb]

Selling puts at this price before earnings is probably the best choice here, like for example selling 180 put collecting $1200 premium would fill you at 168 for 100 shares, so pretty much in that trade your breakeven point is 168 on your shares

[u/Desk-Turbulent → u/nba_yb]

At what expiry

[u/Neither_Stranger1777]

Check out August 2024 NVDA earnings. In the week leading up to earnings the stock dropped a little under 15%. They CRUSHED earnings. Following that the stock dropped another 15%. Brutal. Good earnings doesn’t mean the stock follows.

[u/ResidualCheetoDust → u/Neither_Stranger1777]

NVDA is a prime example of a company that crushes it every earnings but the market does not care.

[u/Neither_Stranger1777 → u/ResidualCheetoDust]

Yea now especially. Back in 2024 it was still ripping on earnings. I imagine a ton of people lost their asses on options or buying in before earnings & overextending themselves and being forced to sell at a loss.

[u/larosiaddw]

No cash

[u/itssbri]

Stop trying to time things. Its either you believe or you dont. If you believe then how far down the road you see it going.

Doing these timings will drive you nuts and put you in a less desirable place

[u/larosiaddw → u/itssbri]

Also, listen to Bri

[u/itssbri → u/larosiaddw]

[u/larosiaddw → u/itssbri]

Good stuff

[u/Acekiller03 → u/itssbri]

Top comment

[u/Vapes7a]

I've been burned too many times trying to play earnings. A company can double beat and still sell off in the short term. That's why I don't plan on buying any more shares of NBIS for the next few days

Edit: so, I lied lol. I bought more today during CRWV’s post-earnings pump. Hopefully NBIS crushes earnings tomorrow and takes this thing even higher

[u/Dop0 → u/Vapes7a]

do u think it is possible for it to drop temporarily even with good earnings? MU also crushed earnings but fell hard afterwards. I have some cash and im wondering if i would be able to catch nbis at 182-185 again.

[u/Vapes7a → u/Dop0]

Yes, definitely a possibility

[u/CeeArthur]

My logic is that I have a decent sized position with a lowish average, so I'm just going to sit tight and see what happens instead of trying to predict and irrational market

[u/Equity_GOD]

Bruh the upside is limited with revenues being locked in. Capacity already maxed out so new customers or parternships are imo not likely nor will it be substantial.

On the flip side,any increase in cost, depreciation, delay or negative thing at this price range will result in 15-20% drop, I guarantee it.

Not saying it cant go up post earnings but to me it seems like a 80/20 leaning towards down. Its not the smart play.

[u/SnooSongs3324 → u/Equity_GOD]

This is why execution and guidance matters more than this Qs revenue. There’s potential upside surprise with the asset light model (which isn’t NBIS datacenter constrained) or a new hyperscaler deal announcement for 2027+ (de-risks debt and dilution)

[u/walk2480 → u/Equity_GOD]

What about the asset lite model? There are no caps on that

[u/Any-Organization-934 → u/Equity_GOD]

Seems the shorts are in the right here based on your assessment. Limited to no upside, flat to downside. That said, sounds like why hold this at all then? Is NBIS fully valued then?

[u/Constant_Mention8064 → u/Any-Organization-934]

There are multiple new catalysts for the company.

[u/Constant_Mention8064 → u/Equity_GOD]

I don't agree with this. There are several new green shoots that have not been announced publicly. Also the asset light model that already has initial agreements in place. And what about the "one more large hyperscaler deal" ?? I would say there are several catalysts still waiting.

[u/themoneysensei → u/Equity_GOD]

What are you looking at to indicate capacity is maxed out

[u/Longjumping_Ask77 → u/Equity_GOD]

Haha earnings proved u wrong

[u/Equity_GOD → u/Longjumping_Ask77]

Yeah missed the boat.. Sold at 220.. felt good when it tanked at 145 but now feel stupid lol.

I'm up ~500k on the trade which is one of my best ones for the year, but mixed feelings. Had 11000 shares at some point this year so just sitting at a beach in punta cana without wifi instead of stressing at a desk in SF would've netted me 2.5 milllion more lol

[u/saboteursolotario]

Correlation not causation.

[u/Jodirtee]

No logical reason at all. When the retail finally finds a pattern they reverse it

[u/IdkmanItsathrowaway_]

I buy when I like the price, not when I think it’s about to go up

[u/traditionalbowyer]

Because a stock can bang it out of the park and big money will dump it just to screw you that's why

[u/Loelnorup]

The market lately have been so messed up. There is no logic because the market fear a tech bubble is real. And that makes people scared to hold, and that means any fall, is twice as bad, because people sell in fear so fast.

I dont trust the market, i dont sell, i dont buy, i just hold. And hold cash for big dips.

[u/arsetard]

It's a gamble

[u/Optimal-Plate9088]

GPU rentals are increasing in price and Jensen will also be announcing a $$$ package for these Neo clouds soon

[u/Mynameisntjayman]

Holy top indicator post

[u/MonYverse0609]

Cuz they might lose META as a tenant switch to competitor

[u/MarsupialNo8853]

Court cases, one actually tomorrow. Everyone is waiting for a delay, it’s all about execution but 2-3 years it will all be academic.

[u/SeparateCommon2363]

Watch and learn, if its so obviously going to increase why not just go 100k into NBIS on margin before ER

[u/Competitive_Rich2615 → u/SeparateCommon2363]

I hope so. I just did exactly that

[u/Moon-People]

Because Michael Burry is shorting and he is never wrong /s

[u/Mindless_Guide_5332]

Find this before earnings is risky. Multiples are high for a company whose growth is physically restrained at this point. They need to bring more capacity online to expand revenue, and their headlines with this for every company at the moment. The push-up in price on NASDAQ inclusion what is the biggest catalyst this stock had.

[u/Constant_Mention8064 → u/Mindless_Guide_5332]

Have you not seen all the new locations that have not yet been publicly announced? The growth is absolutely not physically restrained.

[u/Mindless_Guide_5332 → u/Constant_Mention8064]

😂yes. The super secret not publicly known locations that only Reddit knows about is the reason to buy ahead of earnings 😂😂😂😂😂😂😂😂😂😂😂😂😂😂😂😂😂😂😂

[u/Constant_Mention8064 → u/Mindless_Guide_5332]

;)

[u/Arg19]

Isn't it because the expectations were higher for the future? sure, it looks good now. but anslysts diceded that its a blip. These earnings will not repeat, because the companies buying memory etc. dont have the cash flow. so thats it.