Which Stocks Look Ready to Surge and Sink 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.

In its latest earnings preview, BullMarket.com looks at several popular stocks, including Cree (CREE), NetApp (NTAP), Macy's (NYSE:M), Deere (DE), Cisco (CSCO), Wal-Mart (WMT), Nordstrom (JWN), and Dick's Sporting Goods (DKS).

Here is just a tiny sample of what BullMarket.com wrote about Macy's:

Macy's has beaten EPS estimates each quarter over the last two years. During that span, the stock has risen the next session four of eight quarters. Seasonally, the stock has risen three of the past four years.

Last quarter, the retailer reported a first quarter profit of $217 million, or 55 cents per share, for the quarter that ended on May 4th. The result was 20% better than the $181 million, or 43 cents per share, reported for the year- earlier period.

Sales grew by 4% to $6.38 billion, with sales on a same-store basis rising by 3.8%.

Wall Street was looking for EPS of 53 cents on $6.4 billion in sales, with same- store sales up by 4.3%.

The strongest merchandise categories were handbags, watches, active apparel, men's, home textiles, luggage, furniture, and mattresses. Cosmetics and shoesboth had a good quarter but not as strong as the other businesses, the company said.

The company reaffirmed full-year EPS guidance of $3.90 to $3.95, which brackets the Wall Street consensus. Management said it expects same-store sales to grow by 3.5%....

Outside of earnings, Macy's has done a good job improving its image and product selections, which has resonated with customers. Its My Macy's localization strategy, which tailors its merchandise and marketing strategy to local markets, has proven to be a big winner since it was rolled out nationwide in 2009

Like Nordstrom, it has also been focusing on becoming a multi- channel retailer. While not up to Nordstrom's standards yet, its large store base across the country gives it a competitive advantage. ...

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 Q2 so far were:

  • to expect a positive reaction to Facebook's (FB) results.
  • to expect a positive reaction to Priceline.com's (KORS) results.
  • to expect a negative reaction to First Solar's (FSLR) results.
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