MidnightTrader Earnings Play: Adobe

Adobe (ADBE | Quote | Chart | News | PowerRating) is due with its Q2 results after the bell tonight, and analysts polled by Thomson Financial are expecting the company to post a profit of $0.46 per share on revenue of $880 million.

ADBE is one to watch in post-bell trading as the issue maintains a long-term widening pattern between the sessions following after-hours earnings events. The stock has seen more aggressive next-day percentage closing levels following 10 of its last 17 after-hours, earnings-driven moves. The near-term pattern is mixed however, with two widening and two narrowing moves in the last four quarters; one of its widening moves was last quarter.

On March 18, 2008, ADBE gained 5.6% during evening hours after a profit beat. The gain nearly doubled, to 9% during the next day's regular trading session.

On Dec. 17, 2007, the stock fell 1.8% during evening trading despite a Q4 beat and Q1 guidance largely above the Street view. The stock rebounded to gain 2.7% the next day.

On Sept. 17, 2007, ADBE gained 4.3% in after hours when the company beat Q3 expectations and guided for Q4 to top Street views. However, shares lost their momentum and ended the next day session up only 1.5%.

On June 14, 2007, ADBE dipped 0.8% in the night session despite beating Q2 estimates and forecasting Q3 in line with expectations. Shares fell further the next day, closing the regular session down 2.7%.

On March 20, 2007, ADBE rose 3.5% in after-hours trade when the company topped Q1 EPS estimates but was shy on sales. It also offered guidance in line with expectations. Shares extended those gains the following day, closing the regular session up 6.2%.

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.