Why stocks +20% and -20% after earnings?

Live session recap · Thursday 6 August 2026

Let me ask the question everybody is asking.

Why are some stocks up 20% and some stocks down 20%?

Sometimes we get great earnings and the stock still falls 8%, like AMD. Sometimes a company misses by a fraction and drops 20%, like AppLovin. And then Microsoft beats, not by a huge amount, and jumps 20% and keeps going.

This quarter we are starting to see a trend. It is all about the cash.

The cash inside your profit and loss account. The forward cash flow. That is what investors want to see right now, because with cash you can inject capital, you can buy back stock, you can survive a tightening cycle. I spoke about this on Monday. Today I have got more data to show you.

Five companies: $PLTR, $SPCX, $APP, $AMD and AWS inside $AMZN.

Before any numbers, here it is.

One. The demand question is settled. Every company that reported this week grew, and some of them grew enormously. That argument is over. Growth in almost any sector is intact, unless you are Nike, and that is a different story.

Two. The new question is cash. Like you and me. We like cash. It does not matter how much AI language you put in the press release or how big your new total addressable market is. It comes down to how you generate cash.

Three. The Fed changed the maths. The market is pricing a rate rise, not a cut. And on top of that we are pricing a rising 20-year corporate bond yield, which I covered Monday. Your valuation is not compressing for growth. It is compressing on valuation. That makes cash promised in the future worth less to you today.

Four. What that means for you. Nothing here is a buy or a sell instruction. It is a reminder to set your levels in advance. I have already adjusted my BuyTrigger levels. I adjusted my ValueTrigger as of Monday.

Look at the board.

Year on year revenue growth: $PLTR 93%. $SPCX 92%. $APP 53%. $AMD 50%. AWS 37% inside $AMZN.

What is there to complain about? Back in the day we were excited about 20% growth. Now we are talking about 50 to 100% growth and nobody is happy. They beat on EPS. They beat on revenue. Nobody is happy. The stock still drops.

So growth alone is clearly not what the market is paying for right now. Hold that thought.