Stocks tend to be most volatile around earnings season, when a good or bad report can make or break it. However, a good or even great earnings report doesn't necessarily translate into a huge pop for a stock.
During earnings season, BullMarket.com publishes a comprehensive 20- to 30-page Earnings Preview report for the week ahead each Friday.
Over the past year, BullMarket.com used the data it has collected to correctly predict investor reactions for approximately two-third of the stocks it's previewed.
In its latest earnings preview, BullMarket.com looks at several popular stocks, including Lowe's (LOW), Hain Celestial (HAIN), Intuit (INTU), Dell (DELL), Best Buy (BBY), Toll Brothers (TOL), Pandora Media (P), Hewlett-Packard (HPQ), and Salesforce.com (CRM).
Here is just a tiny sample of what BullMarket.com wrote about Lowe's:
Lowe's has topped analyst EPS estimates six of the past eight quarters, missing the consensus twice. Over that span, the stock has risen the next session four of eight quarters. Seasonally, the stock has risen three of the last four years.
Last quarter, the home improvement retailer said its net income for the quarter that ended May 4th grew by 14% to $527 million, equal to 43 cents per share, compared with $461 million, or 34 cents per share, in the year-earlier period. Lowe's per-share earnings grew by a brisk 26.5% as a result of the company's share repurchases in the past year.
Its sales grew by 8% to $13.2 billion. Sales on a same-store basis increased by 2.6%. Same-store sales at the core U.S. stores were up 2.7%. The rate of growth slowed from the fourth quarter, which analysts said reflected market-share losses to Home Depot (HD).
Wall Street analysts were expecting the company to report 42 cents per share in earnings on sales of $12.99 billion. Many analysts were looking for a stronger performance on a same-store basis. The consensus estimate was for same-store growth of 4.4%.
A calendar shift added a nickel per share to the Q1 results, but that was reflected in the Street consensus. There was also a penny charge related to a previously announced cut in Lowe's headquarters staff.
Management reduced its EPS guidance for the year by two-cents per share to a range of $1.73 to $1.83. The consensus was at $1.86. ...
Outside of earnings, Lowe's continues to trail its main rival, Home Depot (HD), as its same-store sales results have lagged Home Depot for seven-consecutive quarters.
The company is investing in technology and staff training to improve customer service. It is also in the process of shifting to an everyday low-price strategy and plans to increase its offerings of higher-margin but lower-priced house-branded products.
While we like the investments in technology and new tools that empower its sales force in the store and online upgrades that help customers visualize a home- improvement project, the pricing strategy is a wildcard. Customers have become conditioned to a lot of promotional activity from the two big home improvement companies, and while in a totally different retail segment, look at what happened when J.C. Penney (JCP) tried to switch to a everyday low-price strategy. ...
Just a few of the recent correct calls BullMarket.com made for Q2 were:
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