Posts Tagged ‘earnings season’

Differing Views of eBay (EBAY) Ahead of Earnings

Wednesday, January 19th, 2011

eBay options action ahead of earnings If the recent influx of put activity is any indication, bearish traders are flashing their teeth in eBay (NASDAQ:EBAY) ahead of the online auctioneer’s earnings report after today’s close. BusinessWeek reported that the ratio of outstanding puts versus calls rose to 1.23 from 1 last week, hitting its highest point since July 2003.

Analysts, on the other hand, appear to be skewing bullishly. The consensus earnings estimate stands at 47 cents per share, marking a three-cent improvement over year-ago levels.  What’s more, according to Bloomberg, only one of the 35 analysts covering the shares rates it a “sell,” with 15 naming EBAY a “buy.”

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Major Earnings Due Next Week – The Volatility Report

Friday, July 30th, 2010

A couple of weeks into this quarter’s round of reports and the overall results seem positive so far.  At least that seems to be how the market has interpreted them.  At the end of the day, when it comes to investing, it’s all about a stock’s relative value (for most of us, anyway).  Earnings results can make or break a stock’s price trajectory, accelerating a current trend or reversing it.

Since June 12, which was the start of this earnings season, the S&P 500 has risen from 1070 to its current level of about 1105.  While the broad index has managed to get above its 20- and 50- day simple moving averages (SMA), it still has yet to clear and hold above the 200-day SMA, which is currently 1,114.3.

This is in addition to resistance the index may encounter up around the 1,130 level, which was the high back on the 21 of June.  The reality of all of this is that we are currently trading just above most of June’s levels, but far below the highs of around 1220 visited in April.  While the majority of stocks seem to be meeting or beating estimates, there are a few areas where growth is just not there or a company is guiding lower.

Top line or actual gross sales/revenue seems to be the focus of many market participants. After all, a company can only cut costs so much. Without a real increase in revenue, there may not be much of a reason for companies to hire new employees, which is another looming specter for the markets.  By the way, non-farm payrolls will be released next Friday ahead of the opening bell.

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WYNN Reports Earnings Thursday – Are You Prepared?

Wednesday, July 28th, 2010

Wynn Resorts (WYNN)Casino giant Wynn Resorts (NASDAQ:WYNN) reports earnings on Thursday, July 29, 2010.  Analysts are expecting quarterly earnings of 32 cents per share and the high and low estimates are $0.58 and $0.09, respectively. Earnings season has been relatively strong thus far, with about 80% of companies beating analysts’ expectations.

Granted, earnings estimates are subjective, but the market seems to like what it’s seeing so far across the board. The S&P 500 Index (SPX) is up more than 100 points (or about 10%) since its lows early in the month. The questions heading into Thursday’s report are not only what will WYNN’s report look like but what will the market make of these earnings?

Fundamental Data

Looking at the Las Vegas tourism data (through June 1, 2010), visitor volume has slowly been climbing. Compared to 2009, volume is up 1.5% (according to the Las Vegas Convention & Visitors Authority).  Overall gaming revenue for the Las Vegas Strip is up 4.4% for the year, but much of that was due to a large jump in February, which will NOT be included in this quarter’s numbers.   Gaming revenue has actually been on the decline for April and May on the Las Vegas Strip.

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Earnings, Economic Data, and the Housing Sector: A Fast Money Post-Mortem

Thursday, June 24th, 2010

Stock Market BullOn Wednesday’s episode of Fast Money on CNBC, there were a ton of topics discussed and I wanted to clarify my thoughts and elaborate here (especially for topics I didn’t get to address in full on the air).

With the third-quarter earnings season ahead of us, let’s take a moment to reflect on the second quarter that is wrapping up.  During the last reporting period, 480 stocks in the S&P 500 Index had reported as of Tuesday’s close. Out of these, 389 exceeded analysts’ consensus view, with overall net earnings growth of 54.15% year over year.  This leaves the S&P index with a trailing price-to-earnings (P/E) ratio of 16.1 and assumes a forward P/E of 13.3, based on analysts’ expectations of $81 in net index earnings by this quarter next  year.

While P/E ratios seem to be in a relatively neutral-to-low state looking forward, there are still issues to contend with, namely housing and unemployment. (more…)

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Here Come the Earnings…

Wednesday, June 16th, 2010

earningsIt’s the broken record that we traders love to play again and again.  While the process is the same, the outcome is almost always different.  Earnings season is often a catalyst for change in a stock’s direction, volatility, and even sentiment.   It can also simply accelerate a trajectory or cause a stock to do nothing at all, but regardless, just about every investor needs to be hyper-aware of earnings dates, especially the ones that involve your stocks or their peers.

Alcoa (NYSE:AA) is the supposed grand marshal of this quarterly parade, but even though there are some stocks that will report sooner, the aluminum giant’s reporting date should be noted, as the weeks following Alcoa’s report is when the bulk of S&P 500 companies report.

Sectors and their leading stocks tend to report in clumps within a short time frame of one to three days. So if you know a large retailer is reporting, chances are that a comparable peer’s report is not far away.  Peers can obviously have an effect on each other’s stock price and more often than not, a negative report by one stock in a sector will have a negative effect on the others and vice-versa. Some traders call this phenomenon “falling in sympathy.” (more…)

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An S&P 500 Earnings Update

Thursday, June 3rd, 2010

Dollar Bills*Data courtesy of Bloomberg

So the second-quarter earnings season has basically ended and the S&P 500 Index (SPX) just had its worst monthly performance in almost 50 years, dropping 8.2% in May. In terms of earnings numbers for the overall index and the 500 companies that comprise it, the results were not horrific compared to past monthly earnings results and the movements of the index in response to that data.

Of the 496 companies currently contained in the index, 467 have reported results for the last quarter as of June 2, 2010. Overall year-over-year growth was 53.68% with 345 of the companies posting positive growth and 114 reporting negative growth. The biggest jump in terms of year-over-year growth was in the materials sector, which collectively saw a 367% jump in earnings. The worst sector was telecom, which saw negative earnings growth of 4.22%. Additionally, 82% of the companies in the S&P surprised analysts’ expectations to the upside.

So far, with the index at 1079, the trailing price-to-earnings (p/e) ratio of the S&P is 15.73 times and the one-year forward-looking p/e ratio is 13.27 times, according to Bloomberg data. Total earnings per share (EPS) in the index are currently $81.31, and Bloomberg analysts expect next year’s EPS to come in around $95.59.

These are the facts (and the estimates), but the truth of the matter is that we don’t know what the future will bring. (more…)

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Four Key Events Could Make This an Exciting Week for the Market

Monday, January 25th, 2010

This week holds four potentially exciting catalysts; each with the potential to dominate business media headlines.  Is it any wonder that the VIX has spiked back above 25%?

  1. Wednesday night President Obama will deliver his State of the Union address
    Will Health Care remain in focus following the Massachusetts run-off election results?
    Will new Bank regulations and taxes receive a major emphasis?
    Any new initiatives on job creation stimulus?
  2. FED Chairman Ben Bernanke Confirmation vote expected before his term expires on January 31st
    This result will likely be known before it actually comes to a vote. I believe the market may not react well to any uncertainty of a non-confirmation vote
  3. FOMC meeting January 27
    What type of meeting would it be if the pre-confirmation tally turns further against Ben?
    Expectations are for no change to the Fed Funds targets but that decision has not been unanimous lately so the statement may change tone
  4. Earnings season is in full swing
    Apple earnings tonight and Tablet launch on Wednesday
    136 companies in the S&P 500 report including MSFT, JNJ, PG, CVX, T, AMZN and COP

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Intel Earnings May Spark Market Deja Vu

Tuesday, October 13th, 2009

Intel (INTC) earnings were one of the catalysts for the July rally. Given the response of the e-mini NDX futures to the release this evening we may get déjà vu all over again. The futures are higher by almost 1%, indicating a positive start to tomorrow’s trading.

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