MidnightTrader Earnings Play: SMART Modular

SMART Modular (SMOD | Quote | Chart | News | PowerRating) is due with Q3 results after the bell tonight. Analysts in the Thomson Financial survey look for earnings of $0.06 per share on $152 million in sales.

The stock is one to watch as SMOD had just favored a narrowing in its next-day share move after an evening earnings report in the handful of quarters we've tracked, but has since turned mixed. It has cut back or reversed its after-hours performance in the next day's regular session in four of the last seven quarters we've tracked.

On March 20, 2008, the stock fell 2.5% during extended-hours trading after SMOD missed with Q2 results. The stock reversed and surged 23.6% the next day.

On Dec. 19, 2007, the stock gained 3.6% during evening trading after a Q1 beat. The gain swelled to 22.7% the next day.

On Oct. 3, 2007, SMOD fell 4.7% in after hours when the company topped Q4 sales estimates but missed on sales. It also offered mixed guidance. However, shares managed to erase most of those losses the next day to close the regular session down only 0.9%.

On June 27, 2007, SMOD dropped 5.9% in night trade after missing Q3 sales estimates and forecasting Q4 sales also to miss expectations. Shares slid further the next day, closing the regular session down 9.8%.

On March 28, 2007, shares rose a slim 0.4% in the evening hours after the company beat with its Q2 results. The gain expanded slightly to 0.9% by the close of trading the next day.

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.