Why do stocks fall after beating earnings
The volume after a company reports earnings often provides large hedge funds with the opportunity to exit a large position without knocking down the price of the stock. If the ER is a beat, then there will be plenty of buyers to prop up the price and help them unwind their position. Panic. As traders take their profits and the stock price declines, a sense of panic begins to set in. This leads to further selling and a steeper decline in the price of the stock.