Company Events & EarningsExtended setexperimental liveNew

Pead Price Trend Confirmation

Updated dailyData needs: mediumlong onlyshort onlylong short

paper

1989

Source

Bernard-Thomas 1989 JAE / 1990 JFE -- Post-Earnings-Announcement Drift.

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In plain terms

PEAD drift is stronger when the post-announcement price move aligns with the earnings surprise direction.

How it works

Post-earnings-announcement drift is stronger and more persistent when the price reaction in the first 1-5 days after the announcement confirms the surprise direction. Price trend confirmation filters out noise from the raw surprise and selects the sub-sample where the market is genuinely underreacting.

Live results

1 times picked on its own · 15 times inside a blend (9 beat the stock) · updated 2026-07-06

This strategy is a frequent ingredient in blends that combine a few strategies on one stock. It has contributed to 15 such blended picks (9 of which beat simply holding the stock). Picking it on its own is only one of the ways it shows up.

How its picks scored vs. buy & hold

Each pick is graded on a recent year it was never tuned on, against simply owning the same stock

Where its edge concentrates

Share of picks in each company-size group that beat buy & hold

How often it trades

Active vs. patient. Bars on the left mean it waits for rare setups; bars on the right mean it trades often

Return vs. buy & hold

How much each pick beat or trailed simply owning the stock over the test year (extreme microcap moves trimmed)

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Data dependencies

Daily prices
Adjusted-close OHLCV for every US-listed ticker; primary price feed.
Earnings history
A data feed this strategy reads, refreshed on its normal schedule.

Expected edge

Reported return: ~2% per quarter (confirmed subsample)
Tested over: 1974-1986 (Bernard-Thomas)

PEAD confirmed by price trend delivers roughly 2x the raw PEAD return with fewer reversals.

Related families

Revision Momentum ConfirmationCompany Events & Earnings

When both analyst estimate revisions and price momentum point the same direction, the combined drift is more reliable than either signal alone.

Surprise Acceleration RsCompany Events & Earnings

Stocks where earnings surprises are accelerating quarter-over-quarter while price is trending up show compounding drift.

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