Market Overview

Earnings Expectations for the Week of December 19


As Christmas and the end of the year rush toward us, here is a quick look at expectations for some of the most prominent quarterly reports scheduled for this week. These include Bed Bath & Beyond (NASDAQ: BBBY), General Mills (NYSE: GIS), Nike (NYSE: NKE), Oracle (NASDAQ: ORCL) and Walgreen (NYSE: WAG).

General Mills

This branded foods producer says it has paid dividends without reduction or interruption for 113 years. When the Minneapolis-based maker of Wheaties and Yoplait announces its fiscal second-quarter results on Tuesday, it is expected to say that earnings rose three cents per share from a year ago to $0.79. That estimate is unchanged over the past 60 days. Revenues are forecast to be 13.0% higher to $4.6 billion. General Mills earnings have fallen short of consensus estimates in just one of the past eight quarters. Its share price has pulled back about 3% from a recent multiyear high. Over the past six months, the stock has outperformed Kellogg (NYSE: K) and the broader markets.


Analysts are looking for the world's leading producer of athletic footwear, apparel, equipment and accessories, which scheduled to report Tuesday, to post per-share earnings that increased 3.1% year over year to $0.97. And for the fiscal second quarter during which the company increased its quarterly dividend by 16%, revenues are expected to total $5.6 billion. That would be a 16.3% increase from a year ago. And in the current quarter, revenue and EPS so far are expected to rise sequentially and year over year. Note that Nike's earnings also have fallen short of consensus estimates in just one of the past eight quarters. Shares have pulled back more than 4% from a recent multiyear high, but they are trading only about 6% higher than a year ago.


During the three months that ended in November, this enterprise software company launched Solaris 11, the first cloud OS, and it announced a deal to acquire customer service company RightNow. On Tuesday, Oracle is expected to post $0.57 per share earnings for the fiscal second quarter of 2012. That would be up from $0.51 per share in the year-ago quarter. Revenues are forecast to be up 6.7% to $9.2 billion. So far, revenue and EPS for the current quarter are expected to higher sequentially and year over year. Note that analysts have underestimated Oracle's per share earnings in the past six quarters. The share price fell almost 8% in the past week and is down about 6% year to date. Over the past year, the stock has underperformed that of competitor SAP (NYSE: SAP).

Bed Bath & Beyond

The consensus forecast for this retailer of domestic merchandise calls for $0.88 per share earnings in Wednesday's report. That would up from $0.74 in the fiscal third quarter of last year. And revenues are expected to have risen 7.2% to $2.4 billion for the quarter in which the company saw a strong start to the holiday shopping season. Analysts have underestimated per-share earnings in the past ten quarters, though. And the long range EPS growth forecast is 14.6%. The share price has pulled back about 3% in the past week. The stock has outperformed competitors such as Williams-Sonoma (NYSE: WSM) and Target (NYSE: TGT) over the past six months.


Analysts predict that this drug-store chain operator will report Wednesday that its earnings increased 7.5% year over year to $0.67 per share. But note that the EPS estimate is down from $0.72 some 90 days ago. In the fiscal first quarter, Walgreen offered a coupon app for smartphone users on Black Friday and unveiled its first electric vehicle charging station. Revenues for that period are expected to total $18.2 billion, a 5.0% increase from a year ago. Here again, revenue and EPS in the current quarter are forecast to be higher sequentially and year over year. Walgreen's share price is up more than 12% from a recent 52-week low but still more than 10% lower year to date.

And Others

Other companies scheduled to report quarterly results this week include American Greetings (NYSE: AM), CarMax (NYSE: KMX), Carnival (NYSE: CCL), ConAgra (NYSE: CAG), Jabil Circuit (NYSE: JBL), Red Hat (NYSE: RHT) and Sanderson Farms (NASDAQ: SAFM).

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