Yes earnings season is over. But there are still some stragglers and some who have off-calendar quarterly report cycles. We are gearing up for earnings from AMBAC Financial (ABK), Nike Inc. (NKE), FedEx Corporation (FDX), GameStop Corp. (GME), and Palm, Inc. (PALM).
AMBAC Financial (ABK) is up for earnings right after the closing bell on Tuesday after a sudden late-morning spike in trading. The earnings estimate (if you trust one estimate) is -$3.34 EPS from Thomson Reuters. This made a run with the other speculative or junk financial names last week. Based on other municipal insurance reports and based upon recent share price moves, the interest here may be increased. The biggest problem here is far outside of its earnings report and far outside of a stated book-value. Many still feel this stock is doomed.
Nike Inc. (NKE) is up for earnings on Wednesday and Thomson Reuters has the biggest sports apparel and equipment retailer at $0.89 EPS and $4.60 billion (up from $0.88 and $4.59 billion at the end of last week). This would compare to $0.99 EPS a year ago but on a 3% sales gain. Go ahead and expect the first question to be about Tiger Woods as that was the case at Nike’s last quarterly conference call Q&A from analysts. The other key issue that always plays a large impact in Nike is global currencies. Another big issue here is valuation as the stock just hit new 52-week highs this morning of $70.97. After looking back, that actually challenges and exceeds the highest ever price of $70.60 back in 2008.
FedEx Corporation (FDX) is on deck Thursday. The recovery has helped FedEx gain about 150% from its lows of the recession. Thomson Reuters has estimates of $0.72 EPS and $8.33 billion. Valuation is key here. The company alsmost has to raise guidance just to hold its own for fiscal May-2010 as those estimates are $3.63 EPS and $33.66 billion in revenues. If no guidance is raised, you will be hearing about stretched valuations from probably more than just here. A technician was on CNBC just yesterday noting how the FedEx chart is saying that a double dip recession is inevitable. As goes FedEx, you can probably expect the same sort of reaction from UPS (UPS).
GameStop Corp. (GME) is up for earnings Thursday morning and it is no secret about how poor this sector has been. The recent rumors about a GameStop buyout seem more tabloid than factoid. The estimates from Thomson Reuters are $1.28 EPS and $3.45 billion, both of which would be under a year ago despite the notion that the economy is supposed have easy comparables a year back. But because of earnings warnings and because of management departure, it really looks like the bar is set very low here. It also seems likely that any positive news at all would be well received. At $19.20 today, its 52-week range is $17.12 to $32.82.
Palm, Inc. (PALM) is perhaps the one that traders and investors alike will be watcing the most. While it is almost a certainty that Palm is no challenge at all now to Apple (AAPL) over the iPhone nor to Research-in-Motion (RIMM) for the Blackberry, that does not mean that Palm itself won’t have a wide move. Despite more phones being launched with more carriers, Palm’s Pixi, Pre, and Treo models just aren’t keeping up iPhones, Droids, and Blackberries and we already saw a big earnings warning kick this company right where it hurts. At $5.55, how great can things be with a warning still so fresh. Thomson Reuters has estimates of -$0.42 on $316.19 million in revenues, and the estimates for next quarter are -$0.43 EPS and $306.6 million in revenues.
As a reminder, Friday is not just options expiration date. It is quadruple witching date. That can bring on added volatility in stocks with news events.
