PEAD (post earnings announcement drift)

I come across at (http://ivanhoff.com/) to notice the following approach developed by Ivan Hoff. It looks like an interesting approach. I need to take sometime to dig into it.

http://ivanhoff.com/how-markets-work/

Quotes as following:

My equity selection approach is based on PEAD (post earnings announcement drift).

I pay attention to stocks that meet the following criteria:

1) Grow their earnings and sales at an impressive pace;

2) Have just surprised the Street’s estimates by a wide margin after a long period of being neglected in terms of price range and liquidity.

3) Breaking out to at least new 6 month high (I prefer multi-year highs);

Prices trends are fueled by catalysts. The most powerful catalysts always have an element of surprise ingrained in them. The best performing stocks in any given year are the ones that manage to surprise the most often and by the highest margin. The surprises are always earnings related. When they are not related to actual earnings, they are related to expectations for future earnings.