To The Moon

$SolarWinds Corp(SWI)$ is expected to release earnings on 08 Feb 2024 before the market opens (BMO).

Analysts on Wall Street project that SolarWinds (SWI) will announce quarterly earnings of $0.21 per share in its forthcoming report, representing an increase of 10.5% year over year. Revenues are projected to reach $190.55 million, increasing 1.9% from the same quarter last year.

Shares of SolarWinds have demonstrated returns of +3.2% over the past month compared to the Zacks S&P 500 composite's +5.3% change. Solarwinds has done a prediction that enterprises will leverage advanced artificial intelligence and automation capabilities to accelerate transparency, growth, and productivity in December 2023.

Technical is showing uptrend. Solarwinds have been trading above the 50-day MA period for more than 50 trading sessions. This show the confidence and sentiment from traders and investors on Solarwinds.

Solarwinds should be able to benefit from increase enterprise spendings on the network security as part of their advanced artificial intelligence deployment.

Solarwinds (SWI) Last Reported Earnings

SWI last reported earnings on November 02, 2023 before the market opened (BMO). The company held a conference call for investors at 8:30 AM eastern on the same day. SWI shares gained +9.7% the day following the earnings announcement to close at 10.33. Following its earnings release, 97 days ago, SWI stock has drifted +19.9% higher.

From the time it announced earnings, SWI traded in a range between 10.40 and 12.55. The last price (12.39) is closer to the higher end of range.

Estimated implied straddle for upcoming earnings is 6.9%. We could see a positive upside price effect based on the trend we are seeing from the big tech, AI (artificial intelligence is the main talk now).

Solarwinds (SWI) Post Earnings Movement

The options market overestimated SWI stocks earnings move 75% of the time in the last 12 quarters. The predicted move after earnings announcement was ±9.1% on average vs an average of the actual earnings moves of 6.7% (in absolute terms).

We could see some price volatility but I would think implied move is towards the positive side for at least 3%.

Solarwinds (SWI) Earnings Implied Volatility Crush

SWI's last earnings implied volatility (IV30) going into earnings was 45.9. The last time SWI released earnings, the implied volatility dropped to 30.5, resulting in an implied vol crush of 34%. 5 days after earnings, the 30 day IV was 38.0.

• Average Implied Volatility Crush For SWI Earnings: 16%

• Average 30 Day Implied Volatility 1 Day Before Earnings: 49.7

• Average SWI 30 Day IV for the Day of Earnings: 41.3

• Average 30 Day Implied Volatility 5 Days After Earnings: 39.2

Summary

Based on what we have seen from Solarwinds in last quarter, the key factors would be the trend in 2024, which Solarwinds has predicted. Solarwinds have been ready to support enterprise in 2023 and also in 2024.

I would be expecting a positive guidance outlook from Solarwinds in the upcoming earnings.

Appreciate if you could share your thoughts in the comment section whether you think Solarwinds would be benefitting from enterprise orders in Q4 2023, as they prepare for advanced AI deployment and projects.

@TigerStars @Daily_Discussion @Tiger_Earnings @TigerWire appreciate if you could feature this article so that fellow tiger would benefit from my investing and trading thoughts.

Disclaimer: The analysis and result presented does not recommend or suggest any investing in the said stock. This is purely for Analysis.