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 two years, BullMarket.com used the data it has collected to correctly predict investor reactions for nearly two-third of the stocks it's previewed.
In its latest earnings preview, BullMarket.com looks at several popular stocks still set to report earnings, including Dell (DELL - News), NetApp (NTAP - News), Hewlett-Packard (HPQ - News), Tiffany (TIF - News), and Costco (COST - News).
Here is just a tiny sample of what BullMarket.com wrote about Dell:
Dell is a technology company that offers a range of technology product categories, including mobility products, desktop personal computers, software and peripherals, servers and networking products, storage and services. Its services include a range of configurable information technology and business services, including infrastructure technology, consulting and applications, and product-related support services.
Last quarter, Dell said its fiscal fourth-quarter profit fell to $764 million, or 43 cents a share, from $927 million, or 48 cents a share, a year earlier.
Revenue rose 2% to $16 billion.
On an adjusted basis, Dell earned 51 cents a share. Analysts had expected EPS
of 52 cents on revenue of $15.96 billion.
Dell's gross margins were 21.7%, up 20 basis points year-over-year but down 140 basis points sequentially. For the quarter, OpEx declined -10 basis points sequentially to 14.6% of revenue.
Operating income was $1.1 billion or 7.1% of revenue. Interest and other expenses were $24 million, driven by a $45 million gain on the sale of an investment. The tax rate was 18.4%, driven by an increase in earnings in lower tax jurisdictions and tax benefits that management said it doesn't expect to repeat in FY 2013.
Breaking down the fourth quarter, Dell said it had record revenue in its Enterprise, Solutions and Services business of $4.9 billion. Dell Services revenue grew 12% to $2.2 billion, while improving margins. The total value of new Services contracts signed was $1.9 billion on a trailing 12-month basis. Services backlog increased 11% to $15.5 billion led by Contracted Services backlog growth of 13%.
"We're very pleased with the progress of our Services business as we head into FY 2013," CFO Brian Gladden said.
Server and Networking revenue increased 6%. Total Storage declined -13%, while Dell-owned IP Storage growth accelerated 33% to $463 million led by continued growth in all of the Dell IP categories including Compellent, which saw over 60% sequential revenue growth, Gladden added.
Desktop revenue was up 3% while Notebook revenue was up 1%. Revenue for the Software and Peripherals business declined -4% for the quarter to $2.6 billion. ...
Dell has beaten the EPS consensus seven of the past eight quarters, missing estimates once. Over that stretch, the stock has risen the next session four of eight quarters. Seasonally, the stock has risen three times in the past four years. ...
Outside of earnings, we think Dell has thus far done a decent job of transitioning from a PC maker and OEM reseller to a more service-oriented company with deeper-owned product offerings. The company sells quite a few products through its distribution channels, but it's a pretty low-margin business. By selling its own differentiated products, Dell can leverage its strong distribution channel to boost margins and then layer on service offerings.
That said, Dell is playing catch up to companies like IBM (IBM - News), and it will take time and a lot of money to purchase companies to fill out its product portfolio. More recent acquisitions include Wyse, Make Technologies and SonicWall. ...
The full BullMarket.com earnings analysis includes a look at historical earnings data and EPS trends for the companies above and more; examines past investor reactions to earnings in various contexts; gives options activity analysis; reviews previous-quarter earnings; and gives an opinion on both what earnings will look like and how investors will react based on the aforementioned data points.
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