Which Stocks Look Ready to Sink and Surge with Earnings Next Week?

Indie Research

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 25- to 40-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 Herbalife (HLF), Buffalo Wild Wings (BWLD), Enterprise Products Partners (EPD), 3D Systems (DDD), Visa (NYSE:V), MasterCard (MA), CVS Caremark (CVS), OpenTable (OPEN), Facebook (FB), and LinkedIn (LNKD).

Here is just a tiny sample of what BullMarket.com wrote about Enterprise Products Partners:

Enterprise has beaten EPS estimates each of the last eight quarters. Over that period, the stock has risen the next session each of the past eight quarters. Seasonally, the stock has risen three times in the last four years.

Last quarter, the company's distributable cash flow (DCF) fell to $885.9 million from $1.43 billion in the comparable 2011 period, good for a coverage ratio of 1.5x its payout. Excluding proceeds from the sale of assets, DCF rose to $854.5 million from $836.1 million. DCF for the year excluding asset sales was $2.9 billion, providing a 1.3x coverage ratio.

Net income attributable to Enterprise in Q3 totaled $615.5 million, or 68 cents per unit, versus $721.1 million, or 82 cents per unit, in the year-ago period when it had fewer units outstanding. Adjusted EPS rose to 71 cents from 70 cents.

Revenue for the period fell to $11.0 billion from $11.6 billion a year ago, which was primarily attributable to lower commodity prices. Gross operating margin was $1.16 billion, up from $1.10 billion a year ago. Operating income was $822.7 million, down from $909.2 million, and adjusted EBITDA was $1.13 billion, down from $1.20 billion....

Outside of earnings, Enterprise is quite simply one of the best-run companies in the MLP space. This best of breed MLP has an attractive set of largely fee-based assets, strong growth prospects, a cost-of-capital advantage given the purchase of its general partner, a robust coverage ratio, and a great management team.

The firm has also been able to grow strongly while issuing less equity than many of its MLP peers. The fact that the company has increased its distribution for 35-consecutive quarters -- during a stretch that saw the worst recession in recent history and energy prices fall off a cliff -- is a testament to its strengths. ...

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.

Just a few of the correct calls BullMarket.com made for Q1 so far were:

  • to be bullish on Netflix (NFLX) ahead of earnings.
  • to be bearish on Baidu (BIDU) ahead of earnings.
  • to be bullish on Coach (COH) ahead of earnings.
  • A daily investment service that is committed to creating long-term wealth for its members, BullMarket.com's Recommended List of stocks is up 104.9% from 2009-2012 versus a 57.9% return for the S&P, a 47.0% outperformance, topping the benchmark each year since the start of the Great Recession. Subscribers receive actionable market commentary, access to 40+ stock ideas on the Recommended List, and real-time trade alerts. Plus, sign up for a free trial today to view Bull Market's in-depth Special Reports - including its annual High Yield and MLP reports - and its timely Earnings Previews, which are published every Friday during the heart of earnings season. Get a Risk-Free Trial to Bull Market Today! (Please note returns are unaudited.)

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