HealthStream (HSTM) Earnings Leak?

The weight of evidence for the US and Canadian markets has improved in the past two weeks, but I still see a bearish bias on the long term. Nevertheless, I continue to watch the markets and maintain my watchlist. This morning I searched the Priority List for stocks moving up on high volume. There were several, including TSCO, PZZI, and SO, but the one that caught my eye was Healthstream, Inc. (NASDAQ: HSTM). It had a huge move on Friday (up 14% on four-times average volume, closing at the session high) combined with the fact that it will be announcing earnings on Monday after the market closes. I'm wondering if news about the company's earnings leaked out early. If so that could set the stage for post-earnings announcement drift (PEAD).


Here a daily chart of HSTM:

More about the company from ir.healthstream.com: HealthStream (NASDAQ: HSTM) is a leading provider of learning and research solutions for the healthcare industry, transforming insight into action to deliver outcomes-based results for healthcare organizations. Through HealthStream's learning solutions—which have been contracted by over 2.5 million hospital-based healthcare professionals—healthcare organizations create safer environments for patients, increase clinical competencies of their workforces, and facilitate the rapid transfer of the latest knowledge and technologies. Through our research products, executives from healthcare organizations gain valuable insight about patients' experiences, workforce challenges, physician relations, and community perceptions of their services. Based in Nashville, TN, HealthStream has an additional office in Baltimore, Maryland.

In the vast majority of cases, a basic rule does apply, and this is: progressing earning growth sooner or later shows up in advancing prices. Yet, sometimes the market overlooks all other aspects but the current fad. - Nicolas Darvas

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