Hightower Advisors’ chief investment strategist Stephanie Link advised investors do their homework this earnings season to find buying opportunities based on fundamentals — not based on the market reaction. “I often say that earnings season is silly season,” Link said. And that’s because the company will report earnings and then immediately you get this reaction. And it has nothing to do with the fundamentals or what the company has to say or what happens to guidance. And that’s exactly what happened today. See the PRO exclusive video above for Link’s view on Bank of America, Johnson & Johnson and other recent earnings. Bank of America shares were trading slightly higher even after the bank reported a first-quarter earnings and revenue beat, with net interest income rising 25% year over year. The bank stock is down 7% this year. At the same time, Johnson & Johnson shares dropped about 2.5% despite topping earnings and revenue expectations in the first quarter. Shares are down 8% this year. According to Link, both stocks represent buying opportunities given their strong results – even if the investor reaction during Tuesday trading has proved lackluster. “You have to do your homework when companies report earnings,” Link said. “Sometimes it takes a couple of days, but at the very least you have to hear what management has to say, listen to the tone and focus on fundamentals.” The strategist revealed her picks this earnings season: Charles Schwab , which reported solid quarterly results, and Schlumberger N.V. , which she said has an attractive revenue mix with exposure internationally.
