Earnings Per Share (EPS) is a financial metric closely monitored by investors. The so-called "positive earnings surprise" - a situation when EPS reading for a stock beats the value forecasted by analysts gives a bullish signal for this stock. The EPS reading lower than the analysts' estimate gives a bearish signal.
The Diluted Earnings Per Share (Diluted EPS) metric calculates a company's potential earnings per share value in the case if all convertible securities get converted to common shares. Convertible securities include preferred shares, stock options, warrants, convertible debt, etc. Diluted EPS is a more scientific way to estimate earnings per share, and it is usually lower than the ordinary EPS.
The Diluted EPS Signal indicator (DEPSS) is a fundamental indicator that calculates trading signals by comparing the Diluted EPS to the EPS Estimate. In many cases, Diluted EPS gives better insight into how a reported EPS reading may impact the stock price.
HOW TO USE For each earnings date, the indicator calculates the Diluted Earnings Surprise percentage value : Diluted Earnings Surprise = (Diluted EPS - EPS Estimate)/ EPS Estimate.
Diluted Earnings Surprise higher than the specified threshold value is a bullish signal. In this case, the indicator displays a green triangle pointing up. Diluted Earnings Surprise lower than the specified threshold value is a bearish signal displayed as a red triangle pointing down.
As one can see on the chart, there are a lot of situations where EPS readings with green labels (the ones that beat analysts' estimates) lead to down moves. The DEPSS indicator can spot weak earnings and give opposite signals.
SETTINGS
Earnings Surprise Threshold (%): the threshold value (in percentage units) for the Diluted Earnings Surprise. The calculated Diluted Earnings Surprise must be higher than Earnings Surprise Threshold to be considered a BUY signal or lower than minus Earnings Surprise Threshold to be considered a SELL signal. The default value for Earnings Surprise Threshold is 20%.
Always great to see a script built around fundamentals. Thanks for sharing!
AstrideUnicorn
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@tbiktag, your support is very motivating to me. Thank you!
PineCoders
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paithaned
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Hi.. I am getting this error "Resolve_error "FUND"".. I have used this script on indices, BTC, Stocks on everything... still getting an error.. am I doing something incorrectly .. please suggest.. thanks
AstrideUnicorn
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@paithaned, this script uses financial reports data, so it will only work for the stocks TradingView has financial reporting data for. I can definitely say, US stocks are supported. You can write me a direct message with the tickers you are trying to use the indicator on and we can see if TradingView has financial data for them.
learningTT
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Hello, seems very interesting. So, when exactly will the signal show up?
PineCoders
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This publication is now featured in our Editors' Picks: tradingview.com/scripts/editors-picks/ . In the name of all TradingViewers, thank you for your valuable contribution to the community, and congrats!
AstrideUnicorn
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@PineCoders, thank you for your support! I highly appreciate it!
bel3205
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Olá, o script não funciona, aparece o ponto de exclamação! Gostaria de testa lo. Grata desde já.
UnknownUnicorn5511258
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This is splendid work, well done. Creative way to filter the true beats from the pump and such - never simple when estimates are never actually estimated earnestly.
To be honest, Im likely going to use this for "evil" in the near term and short the weak stuff. Regardless, thanks for this.