Which Stocks Look Ready to Sink and Surge with Earnings This 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 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 MasterCard:

MasterCard has topped analyst EPS estimates each quarter over the past two years. During that period, the stock has risen the next session six of eight quarters. Seasonally, the stock has risen twice in the last four years.

Last quarter, MasterCard said it earned $605 million, or $4.86 per share, in the fourth quarter, up from $19 million, or 15 cents per share, a year earlier when it booked a $495 million litigation charge.

Revenue rose 10% to $1.9 billion, which was its fastest growth in three quarters.

Analysts on average expected the company to earn $4.81 per share, excluding items, on revenue of $1.89 billion.

MasterCard customers made $727 billion of purchases worldwide on a local currency basis, up 13%.

The non-U.S. volume growth continues to be driven by more than 20% growth in Asia, Middle East and Africa, and mid-teens growth in Europe as well as in Latin America and Canada. ...

Outside of earnings, MasterCard has a long runway for continued growth as the global economy moves from a cash-based system to an electronics payment.

The U.S. debit rules that crimped business a bit in 2012, meanwhile, are now largely in the past and MasterCard didn't have as much debit card exposure as Visa, and could possibly take some share given the new rules.

However, MasterCard does have more exposure to the world's weakest region, Western Europe, as Visa Europe is a separate entity owned and governed by its European member financial institutions. It pays Visa an irrevocable and perpetual license of approximately $143 million per year, payable quarterly. ...

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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