For Immediate Release
Chicago, IL – June 15, 2009 – Zacks.com releases the list of companies likely to issue earnings surprises. This week’s list includes Adobe Systems (ADBE), Best Buy (BBY), Carnival (CCL), FedEx (FDX) and J.M. Smucker (SJM). To see more earnings analysis, visit http://at.zacks.com/?id=3207.
Every day, Zacks.com makes 4 stock picks available, free of charge. To see them, go to http://at.zacks.com/?id=3567.
The Week’s Events
We will see initial second-quarter numbers with Adobe Systems (ADBE), Best Buy (BBY), Carnival (CCL), FedEx (FDX) and J.M. Smucker (SJM) reporting this week. Notably missing from the group are the investment bankers, the surviving members of which have changed to traditional calendar quarters.
Though there are five S&P 500 companies reporting, the earnings calendar is pretty light. Just 23 companies are confirmed to report.
Conversely, the economic calendar is fairly busy. We’ll see the producer and consumer price indexes, housing data and the Phili Fed survey.
- Monday: Empire State manufacturing index, NAHB housing index
- Tuesday: May housing starts and building permits, May PPI, May industrial production and capacity utilization
- Wednesday: May CPI, weekly crude inventories
- Thursday: May Leading Indicators, Phili Fed survey, weekly initial jobless claims
Fed Chairman Ben Bernanke will speak at a financial literacy summit in Washington, D.C. on Wednesday morning. Also speaking this week are Chicago Fed President Charles Evans, Governor Daniel K. Tarullo, Governor Elizabeth Duke and Governor Kevin Warsh.
On Monday morning, Evans will talk about the financial crisis with the Executives Club of Chicago Joint Committee. Also on Monday morning, Tarullo will appearing at a bankers’ convention on Monday morning to discuss risk regulation. That evening, Duke will lecture about the Fed’s response to the financial crisis at the Women in Housing and Finance Annual Meeting.
Warsh will speak to a different bankers’ convention on Tuesday. He will discuss economic policy and the financial markets.
Friday is a quadruple witching day, meaning option and futures contracts will expire. This could lead to higher volatility.
What should be interesting to see is whether we get some end-of-quarter window dressing by fund managers. Many have been sitting on the sidelines – as is evident by the light volume – and are likely underperforming their benchmarks. This raises the possibility that we could see managers buying “good” stocks to make their portfolio holdings look better.
Keep an eye on commodities and bonds. Commodities have been very strong and treasury yields may come down after having just set short-term highs.
Companies That Could Issue Positive Earnings Surprises
Adobe Systems (ADBE) has delivered positive surprises during 7 of the last 9 quarters. (Its fiscal first-quarter numbers matched expectations.) Though the consensus earnings estimate is unchanged at 28 cents per share, the most accurate estimate is higher at 30 cents per share. This suggests another good report could be forthcoming. Adobe is scheduled to report on Tuesday, Jun 16, after the close of trading.
Best Buy (BBY) has benefited from the demise of Circuit City, having topped expectations for 2 consecutive quarters. Three of the covering brokerage analysts think the company may deliver another upside surprise and have raised their fiscal first-quarter estimates as a result. These revisions have led to a most accurate estimate of 34 cents per share, which is a penny better than the consensus earnings estimate. Best Buy is scheduled to report on Tuesday, Jun 16, before the start of trading.
Companies That Could Issue Negative Earnings Surprises
During the past few weeks, 2 analysts have cut their fiscal fourth-quarter profit forecasts on FedEx (FDX). The negative revisions have resulted in a most accurate estimate of 47 cents per share, which is 5 cents below the fiscal fourth-quarter consensus earnings estimate. FDX has missed twice during the past 4 quarters. FedEx is scheduled to report on Wednesday, Jun 17, before the start of trading.
Charles Rotblut, CFA, is the senior market analyst for Zacks.com.
About the Zacks Rank
Since 1988, the Zacks Rank has proven that “Earnings estimate revisions are the most powerful force impacting stock prices.” Since inception in 1988, #1 Rank Stocks have generated an average annual return of +26%. During the 2000-2002 bear market, Zacks #1 Rank stocks gained +43.8%, while the S&P 500 tumbled -37.6%. Also note that the Zacks Rank system has just as many Strong Sell recommendations (Rank #5) as Strong Buy recommendations (Rank #1). Since 1988, Zacks Rank #5 stocks have underperformed the S&P 500 by 111% annually (-0.8% versus +8%). Thus, the Zacks Rank system allows investors to truly manage portfolio trading effectively.
Zacks “Profit from the Pros” e-mail newsletter offers continuous coverage of the industries and the stocks poised to outperform the market. Subscribe to this free newsletter today by visiting http://at.zacks.com/?id=4988.
About Zacks
Zacks.com is a property of Zacks Investment Research, Inc., which was formed in 1978 by Leonard Zacks. As a PhD in mathematics Len knew he could find patterns in stock market data that would lead to superior investment results. Amongst his many accomplishments was the formation of his proprietary stock picking system; the Zacks Rank, which continues to outperform the market by nearly a 3 to 1 margin. The best way to unlock the profitable stock recommendations and market insights of Zacks Investment Research is through our free daily email newsletter; Profit from the Pros. In short, it’s your steady flow of Profitable ideas GUARANTEED to be worth your time! Register for your free subscription to Profit from the Pros by going to http://at.zacks.com/?id=3568.
Zacks Investment Research is under common control with affiliated entities (including a broker-dealer and an investment adviser), which may engage in transactions involving the foregoing securities for the clients of such affiliates.
Visit http://www.zacks.com/performance for information about the performance numbers displayed in this press release.
Disclaimer: Past performance does not guarantee future results. Investors should always research companies and securities before making any investments. Nothing herein should be construed as an offer or solicitation to buy or sell any security.
Contact: Charles Rotblut, CFA
Company: Zacks.com
Phone: 312-265-9352
Email: pr@zacks.com
Visit: www.Zacks.com
