Nutanix (NASDAQ:NTNX), a company that offers cloud computing software designed for data centers and hybrid multi-cloud environments, is set to report its earnings on Wednesday, May 28, 2025. This occasion typically results in notable stock volatility, as shown by historical data. Throughout the past five years, Nutanix stock has recorded a positive one-day return in 60% of instances following earnings announcements. The median positive one-day return was 9.9%, with a maximum increase of 29.2%, underscoring the stock’s sensitivity to earnings news.
For traders focused on events, historical trends can provide an advantage, although much relies on how the actual outcomes stack up against consensus expectations. There are two main strategies to consider:
- Pre-Earnings Positioning: Assess historical probabilities and establish a position before the earnings announcement.
- Post-Earnings Positioning: Analyze the relationship between immediate and medium-term returns after the earnings are disclosed to guide your trading strategies.
Analysts anticipate Nutanix to announce earnings of $0.38 per share on revenues of $627 million for the forthcoming announcement. This is in contrast to earnings of $0.28 per share on revenues of $525 million in the same quarter last year. On a fundamental level, Nutanix currently has a market capitalization of $21 billion. In the past twelve months, the company generated $2.3 billion in revenue and achieved operational profitability with $69 million in operating profits, even with a net loss of $55 million. That said, if you are looking for upside with less volatility than individual stocks, the Trefis High Quality portfoliooffers an alternative — having outperformed the S&P 500 and delivered returns above 91% since its inception. Separately, see – What Sparked UNH Stock Crash?
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Nutanix’s Historical Odds Of Positive Post-Earnings Return
Some insights regarding one-day (1D) post-earnings returns:
- There have been 20 earnings data points documented over the last five years, with 12 positive and 8 negative one-day (1D) returns observed. In total, positive 1D returns occurred approximately 60% of the time.
- This percentage rises to 73% when we analyze data from the last 3 years rather than 5.
- The median of the 12 positive returns = 9.9%, and the median of the 8 negative returns = -8.1%
Further data on observed 5-Day (5D), and 21-Day (21D) returns after earnings are summarized along with the statistics in the table below.
Correlation Between 1D, 5D, and 21D Historical Returns
A comparatively lower-risk approach (although not effective if the correlation is weak) is to comprehend the correlation between short-term and medium-term returns after earnings, identify a pair with the highest correlation, and carry out the fitting trade. For instance, if 1D and 5D show the strongest correlation, a trader can position themselves “long” for the next 5 days if the 1D post-earnings return is positive. Below is some correlation data based on 5-year and 3-year (more recent) history. It is important to note that the correlation 1D_5D pertains to the relationship between 1D post-earnings returns and the ensuing 5D returns.
Is There Any Correlation With Peer Earnings?
At times, peer performance can impact post-earnings stock reactions. In fact, the pricing may begin even before the earnings are revealed. Here are some historical insights regarding the past post-earnings performance of Nutanix stock in comparison to the performance of peers that reported their earnings just prior to Nutanix. For a fair comparison, peer stock returns also reflect post-earnings one-day (1D) returns.
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