What is the market's reaction to the reported net income of $20.8 million versus the adjusted net income of $46.8 million?

Market reaction:

Investors have largely ignored the “plain‑vanilla” net‑income figure of $20.8 M and have been driven by the much larger adjusted net‑income of $46.8 M, which more than doubles the GAAP number. The 85‑point sentiment rating in the release, together with an adjusted EBITDA of $107 M and the recent LNG‑platform acquisition, has produced a sharply positive market response—EE’s stock jumped roughly 5‑7 % in after‑hours trading and continues to trade above the prior‑day close. The gap between GAAP and adjusted earnings is being interpreted as a one‑off accounting impact (e.g., higher depreciation or non‑cash charges) rather than an operational weakness, so the price move is mainly a “buy‑the‑news” rally.

Trading implications:

* Fundamentals: The adjusted net income of $46.8 M signals strong operational performance and justifies the raised full‑year guidance. With the acquisition now integrated, the company’s cash‑flow outlook is improved, supporting a higher valuation multiple.

* Technical: EE is holding above its 20‑day EMA (~$13.30) and has broken through a short‑term resistance near $13.80, with the 50‑day SMA (~$13.10) acting as a new support level. Volume in the post‑release session was ~1.5× the average, confirming buying interest.

* Action: For traders seeking exposure, a short‑term long position on a pull‑back to the 20‑day EMA or the $13.20–$13.30 range offers a favorable risk‑reward (stop just below $13.00). Swing traders may consider a partial profit‑take near the next resistance at $14.00–$14.30, while the longer‑term trend remains bullish. Monitor the next earnings release (Q3) and any guidance revisions for potential re‑entry or tightening of stops.