How Will Luminar Stock React To Upcoming Earnings?

Luminar Technologies Stock (NASDAQ:LAZR) , a company that develops lidar sensors for use in self-driving cars, is expected to report its earnings on March 20. The consensus forecast is for a net loss of $2 per share, down from a loss of $3 per share in the year-ago period, while revenues are estimated at about $18 million, down from $22 million compared to last year. Luminar has been facing headwinds, amid slowing growth in the electric vehicle market and also due to mounting competition from rivals such as Cepton and Velodyne Lidar. The company’s gross margins have remained negative, due to its relatively low volumes and also because it does a lot of manufacturing on its own. Moreover, the lack of profitability is being compounded by a relatively high debt load and sizable interest expenses. Luminar has $162 million in current market capitalization. Revenue over the last twelve months was $75 Mil, and it was operationally loss-making with $-486 Mil in operating losses and net income of $-377 Mil. While a lot will depend on how results stack up against consensus and expectations, understanding historical patterns might just turn the odds in your favor if you are an event-driven trader.

There are two ways to do that: understand the historical odds and position yourself prior to the earnings release, or look at the correlation between immediate and medium-term returns post-earnings and position yourself accordingly after the earnings are released. That said, if you seek upside with lower volatility than individual stocks, the Trefis High-Quality portfolio presents an alternative – having outperformed the S&P 500 and generated returns exceeding 91% since its inception.

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Luminar Technologies’ Historical Odds Of Positive Post-Earnings Return

Some observations on one-day (1D) post-earnings returns:

• There are 14 earnings data points recorded over the last five years, with 6 positive and 8 negative one-day (1D) returns observed. In summary, positive 1D returns were seen about 43% of the time.
• However, this percentage decreases to 40% if we consider data for the last 3 years instead of 5.
• Median of the 6 positive returns = 9.5%, and median of the 8 negative returns =-5.6%

Additional data for observed 5-Day (5D), and 21-Day (21D) returns post earnings are summarized along with the statistics in the table below.

Correlation Between 1D, 5D, and 21D Historical Returns

A relatively less risky strategy (though not useful if the correlation is low) is to understand the correlation between short-term and medium-term returns post earnings, find a pair that has the highest correlation, and execute the appropriate trade. For example, if 1D and 5D show the highest correlation, a trader can position themselves “long” for the next 5 days if 1D post-earnings return is positive. Here is some correlation data based on 5-year and 3-year (more recent) history. Note that the correlation 1D_5D refers to the correlation between 1D post-earnings returns and subsequent 5D returns.

Learn more about Trefis RV strategy that has outperformed its all-cap stocks benchmark (combination of all 3, the S&P 500, S&P mid-cap, and Russell 2000), to produce strong returns for investors. Separately, if you want upside with a smoother ride than an individual stock like Luminar Technologies, consider the High Quality portfolio, which has outperformed the S&P, and clocked >91% returns since inception

[1] Returns as of 3/17/2025
[2] Cumulative total returns since the end of 2016

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