Software stock Asana has a history of negative post-earnings reactions
Asana Inc (NYSE:ASAN) stock finished 2024 strong, with a 43.6% post-earnings gain on Dec. 6. The work management company steps into the earnings confessional on Monday after the close for its fourth-quarter results, and ASAN is in need of another upbeat price reaction.
Asana stock added 3.2% today, but still finished with a 4.7% weekly loss. The shares have taken a 9.5% haircut in 2025, and are 34% off their Dec. 16 three-year high of $27.77. The good news is the pullback has the equity testing its ascending 126-day trendline, a moving average that hasn't been breached on a closing basis since November.
Prior to the December melt up, Asana stock had suffered a post-earnings move lower after six straight reports. Overall, ASAN averaged a next-day move of 14.2% in the last two years. This time around for Tuesday's trading, the options market is pricing in a much larger than usual 22.1% post-earnings move.
The tech stock has massive short squeeze potential, with bearish bettors piling on by 5% in the most recent reporting period. A healthy 15.6% of the stock’s total available float is sold short. At the stock's average pace of trading, it would take bears more than three trading days to buy back their bearish bets.
For a stock up 35.8% in the last six months, there's a lot of pessimism among analysts. Of the 15 brokerages covering ASAN, 11 maintain "hold" or "strong sell" ratings. A positive earnings report could shake some of the weaker bearish stances loose.