MidnightTrader Earnings Play: Blackboard

Blackboard (BBBB | Quote | Chart | News | PowerRating) is due to report Q1 results after the bell tonight, and analysts polled by Thomson Financial are looking for breakeven earnings on revenue of $65.5 million.

Blackboard is one to watch for its post-earnings trading pattern. BBBB, over the long term, had shown a tendency to beat estimates but reverse its after-hours move the next day following an evening earnings event. It has reversed that trend slightly in more recent quarters, putting up three wider moves after its last four reports.

On Feb. 5, 2008, the stock slumped 9.2% in evening trading after Q4 matches Street. The loss widened to 12.1% the next day.

On Nov. 1, 2007, BBBB ended the evening session flat after meeting Q3 expectations and guiding in-line to higher. It turned south the next day, ending the Nov. 2 regular session down 8.8%.

On July 31, 2007, the stock fell 8.4% in the evening hours after reporting ahead with Q2 results but guiding in line to lower. The loss was a steeper 13.9% the next day.

On May 2, 2007, BBBB rose 5.4% in after hours when the company beat Q1 estimates and guided mostly higher. Shares tacked on even more gains the next day, closing the regular session up 7.5%.

On February 6, 2007, BBBB eased 1% in night trade after reporting despite topping Q4 estimates and forecasting Q1 above Street views. Shares recovered and jumped 6.6% by the end of the next day's regular session.

Brooks McFeely is widely regarded as the leading expert on extended-hours trading. He is a Managing Partner for Brochet Capital Partners, LP and the founder of Midnight Trader, Inc. (www.midnighttrader.com), the leading provider of pre-market and after-hours trading analysis and news to retail and institutional investors.