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Which Stocks Look Ready to Pop and Drop with Earnings This Week?

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. As a special holiday treat, BullMarket.com is publishing two extra supplemental previews for December.

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 Dollar General (DG), Joy Global (JOY), Adobe (ADBE), Ciena (CIEN), VeriFone (PAY), and Costco (COST).

Here is just a tiny sample of what BullMarket.com wrote about Joy Global: Joy Global has beaten analyst EPS estimates five of eight quarters over the past two years, missing the consensus three times. During that span, the stock has risen the next session four of eight quarters. Seasonally, the stock has risen two times in the past four years. ...

Last quarter, the mining equipment maker reported net income of $193.6 million for the fiscal third quarter ended July 27th, which was equal to $1.81 per share. That compares to $173.1 million, or $1.62 per share, in the year-earlier period.

Excluding the impact of discontinued operations from both periods and the company earned $1.82 per share from its continuing operations compared with $1.61 in Q3 2011. Revenue grew by 22% to $1.4 billion.

Wall Street analysts were expecting the company to report $1.88 per share on sales of $1.42 billion.

The company reported that its bookings in the third quarter declined by -25% to $1.08 billion. Backlog stood at $2.8 billion compared to $3.1 billion at the end of the second quarter. ...

Outside of earnings, Joy Global is a top heavy-equipment provider for the mining industry, and it is able to command some of the highest margins in the heavy- machinery space. However, 2012 has been a tough year for the firm given weaker demand from China and the U.S. coal sector.

The U.S. coal market is probably Joy's most important, and if it is nearing a bottom, then we would expect better results in 2013 and for its stock to rebound. We like its long-term outlook, but it's a cyclical stock that depends on the strength of its end markets. ...
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 Q3 so far were:

  • to be bullish on DSW (DSW) ahead of earnings.
  • to be bullish on Salesforce.com (CRM) ahead of earnings.
  • to be bearish on Hewlett-Packard (HPQ) 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 33.3% from 2008-2011 versus a -14.4% return for the S&P, a 47.7% 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.)