Tag Archives: Revenue Estimate

Business, Finance, Occupation & Industry

Can Yamana Survive Gold's Plunge?

Leave a comment

By Dan Caplinger, The Motley Fool

Filed under:

On Tuesday, Yamana Gold will release its latest quarterly results. The key to making smart investment decisions on stocks reporting earnings is to anticipate how they’ll do before they announce results, leaving you fully prepared to respond quickly to whatever inevitable surprises arise. That way, you’ll be less likely to make an uninformed knee-jerk reaction to news that turns out to be exactly the wrong move.

Gold mining stocks have performed badly even when gold prices were relatively stable. But in light of the recent plunge in the price of gold, Yamana and its peers face some new challenges. Let’s take an early look at what’s been happening with Yamana Gold over the past quarter and what we’re likely to see in its quarterly report.

Stats on Yamana Gold

Analyst EPS Estimate

$0.18

Change From Year-Ago EPS

(28%)

Revenue Estimate

$564.6 million

Change From Year-Ago Revenue

0.9%

Earnings Beats in Past 4 Quarters

3

Source: Yahoo! Finance.

Can Yamana Gold possibly keep growing?
In light of gold’s plunge, analysts have reined in their estimates for Yamana going forward. Even on the just-ended quarter, they’ve cut their earnings-per-share consensus by more than a dime, but the $0.40 per share downward adjustment for the full 2013 year reflects huge concerns over the future of gold mining. Those concerns have cut more than 30% off Yamana’s stock price since late January.

Yamana has done a better job than many of its peers in fighting many of the challenging trends that the industry has faced recently, especially rising mine operation and construction costs. In last quarter’s report, Yamana managed to sustain profit margins near the company’s historical levels and is aiming to keep its all-in cash costs at the lowest level of any producer.

One way Yamana has kept its competitive cost advantage is through extensive sales of base-metal byproducts like copper and zinc, as both it and fellow low-cost rival Goldcorp benefit from utilizing those secondary metals to offset the cost of their gold production. Peers Gold Fields and AngloGold Ashanti , on the other hand, face much higher costs in part because of their exposure to South Africa and its unstable labor market.

Yet one thing is certain: When gold prices drop, profits will drop with them. Yamana may be the best positioned to handle price declines and still remain profitable, but investors need to prepare for earnings decreases if gold doesn’t bounce back quickly. Already, Newmont Mining has cut its dividend based on the drop in gold prices and could make further cuts in the future if gold stays at current levels. Yamana has room to sustain its payout even if earnings decline, but a slump could put an end to its fast dividend growth in recent years.

In Yamana’s report, watch for the latest progress update on the company’s Cerro Moro mine

Source: FULL ARTICLE at DailyFinance

Business, Finance, Occupation & Industry

Has Valero Already Seen Its Best Days?

Leave a comment

By Dan Caplinger, The Motley Fool

Filed under:

On Tuesday, Valero will release its latest quarterly results. The key to making smart investment decisions on stocks reporting earnings is to anticipate how they’ll do before they announce results, leaving you fully prepared to respond quickly to whatever inevitable surprises arise. That way, you’ll be less likely to make an uninformed knee-jerk reaction to news that turns out to be exactly the wrong move.

Refining stocks have done extremely well lately, with relatively cheap domestic crude fueling low input costs while high international prices for gasoline and other refined products widen crack spreads and boost profits for Valero and its peers. But how long can those good times continue? Let’s take an early look at what’s been happening with Valero over the past quarter and what we’re likely to see in its quarterly report.

Stats on Valero

Analyst EPS Estimate

$0.98

Change From Year-Ago EPS

216%

Revenue Estimate

$30.41 billion

Change From Year-Ago Revenue

(13.5%)

Earnings Beats in Past 4 Quarters

4

Source: Yahoo! Finance.

Will Valero keep pressing higher this quarter?
Analysts have gotten even more optimistic on Valero’s earnings recently, raising their earnings-per-share estimates by $0.17 for the first quarter and by $0.30 for the full 2013 year. Yet even though the stock has posted an 8% gain since late January, it has pulled back considerably in the past month from more substantial gains.

Valero has been able to cash in on extremely strong conditions in the market for refined energy products, especially gasoline. In large part, international demand is to blame for continued high gasoline prices in the U.S., with Venezuela having become a huge new player in importing gasoline. Competitors are taking advantage, with rival Phillips 66 having boosted its exports by half in the fourth quarter of 2012 in order to maximize its benefit from those favorable conditions. Still, Valero has a huge share of between 20% and 25% of all the U.S. petroleum products that get sent abroad.

Yet Valero and its peers have seen new challenges pop up recently. Price spreads between U.S. West Texas intermediate and European Brent crude oil have narrowed considerably in April, threatening those wide margins. That’s especially bad news for HollyFrontier , Tesoro , and Valero, whose western-U.S. exposure has helped those companies benefit the most from cheap mid-continent crude supplies. Phillips 66’s recent deal to transport U.S. crude by rail may look a lot less lucrative if spreads narrow further, and Valero and the rest of the industry will inevitably see profits shrink if the financial incentive to export gasoline gets smaller.

Valero could also feel a big hit from regulation. Ethanol credits that Valero and other refiners are required to obtain have soared in cost lately, raising fears that the mandate for higher ethanol use will lead to higher prices at the pump for consumers and a big decrease

Source: FULL ARTICLE at DailyFinance

Business, Finance, Occupation & Industry

Why Jamba's Looking Forward to Summer

Leave a comment

By Dan Caplinger, The Motley Fool

Filed under:

On Tuesday, Jamba will release its latest quarterly results. The key to making smart investment decisions on stocks reporting earnings is to anticipate how they’ll do before they announce results, leaving you fully prepared to respond quickly to whatever inevitable surprises arise. That way, you’ll be less likely to make an uninformed knee-jerk reaction to news that turns out to be exactly the wrong move.

Many businesses get most of their business during the fall and winter months, but for smoothie specialist Jamba, its cold beverages are a tough sell during the frigid part of the year. Let’s take an early look at what’s been happening with Jamba over the past quarter and what we’re likely to see in its quarterly report.

Stats on Jamba

Analyst EPS Estimate

($0.02)

Year-Ago EPS

($0.03)

Revenue Estimate

$54.1 million

Change From Year-Ago Revenue

2%

Earnings Beats in Past 4 Quarters

2

Source: Yahoo! Finance.

Did Jamba hibernate or grow this quarter?
Analysts have gotten more optimistic about Jamba’s earnings prospects in recent months, having slashed their initial loss estimates for the just-ended quarter in half and boosted their consensus for future full-year 2014 earnings by $0.02 per share. The stock has responded in kind with a 6% jump since late January.

Much of the good news for Jamba during the first quarter came when it made its earnings announcement for the previous quarter in early March. Posting its first annual profit since going public eight years ago, Jamba confirmed its previous guidance for 2013, encouraging shareholders looking for further growth from the company.

How Jamba will grow involves a combination of strategies. The company still plans between 60 and 80 new traditional locations this year, but Jamba is also pushing hard on its JambaGO stations, which are small self-service machines targeted largely at school cafeterias. Jamba expects 1,000 new JambaGO locations this year, which would more than triple its count of just over 400 as of the end of 2012.

Internationally, Jamba still has a small presence, but it made a big step by making a master franchise development agreement to open 80 stores throughout Mexico beginning later this year. The success that Arcos Dorados has had in Mexico and other Latin American countries in franchising McDonald’s locations shows the huge potential that the region has generally for American restaurants, and focusing on warmer climates should help Jamba avoid the seasonality it suffers colder markets like the U.S. and Canada.

In Jamba’s report, watch to see if the company’s new store format is inspiring more sales of fresh juice and other beverages that are more in line with what Starbucks focused on in buying juice-specialist Evolution Fresh. If it does, then the potential for a Jamba-Starbucks merger could rise considerably — and the greater product diversification will make Jamba look much more attractive as an independent

Source: FULL ARTICLE at DailyFinance

Business, Finance, Occupation & Industry

Can TD AMERITRADE Make Money From Record-High Markets?

Leave a comment

By Dan Caplinger, The Motley Fool

Filed under:

On Tuesday, TD AMERITRADE will release its latest quarterly results. The key to making smart investment decisions on stocks reporting earnings is to anticipate how they’ll do before they announce results, leaving you fully prepared to respond quickly to whatever inevitable surprises arise. That way, you’ll be less likely to make an uninformed knee-jerk reaction to news that turns out to be exactly the wrong move.

Discount brokers have become increasingly popular as a low-cost way to invest, and TD AMERITRADE is a big player in the discount brokerage space. But competition has become fierce, and even with markets at new highs, some investors have been reluctant to put their money to work ever since the bear market of 2008. Let’s take an early look at what’s been happening with TD AMERITRADE over the past quarter and what we’re likely to see in its quarterly report.

Stats on TD AMERITRADE

Analyst EPS Estimate

$0.26

Change From Year-Ago EPS

4%

Revenue Estimate

$676.3 million

Change From Year-Ago Revenue

0.5%

Earnings Beats in Past 4 Quarters

3

Source: Yahoo! Finance.

Are things looking up for TD AMERITRADE?
Analysts have gotten more optimistic about TD AMERITRADE’s earnings prospects over the past few months. They’ve boosted their earnings-per-share estimates for the just-ended quarter by a penny, and full-year fiscal 2013 estimates have risen by a nickel per share. The stock has also performed well, jumping more than 11% since early January.

TD AMERITRADE and its discount peers offer low-cost trading for stocks, ETFs, and other financial products. By offering services at a fraction of the cost of full-service brokers, discount brokers have grown substantially over the years, broadening their product lines and offering new services such as banking.

But the industry has gotten fiercely competitive, especially as trading activity has fallen in recent years. TD AMERITRADE has answered by joining the big fee fight over exchange-traded funds, with its offering more than 100 ETFs from various fund families at no commission. Yet archrival Schwab answered back with its ETF OneSource offering earlier this year, with a suite of 105 ETFs one-upping TD AMERITRADE’s list.

Competition is also coming from other corners. Leveraging its purchase of Merrill Lynch during the financial crisis, Bank of America has reupped its efforts to attract new customers through its Merrill Edge discount-brokerage unit in an attempt to gain the opportunity to cross-sell clients into B of A banking and other financial products.

In TD AMERITRADE’s quarterly report, be sure to see how the broker’s ETF business is faring against Schwab and other competitors. If its attempt to draw in assets has been successful, then the move could continue paying dividends for TD AMERITRADE well into the future.

Bank of America has worked hard to become an all-purpose provider of financial services to millions of customers. But does the stock belong in your portfolio?

From: http://www.dailyfinance.com/2013/04/14/can-td-ameritrade-make-money-from-record-high-mark/

Business, Finance, Occupation & Industry

US Bancorp Seeks to Start Growing Again

Leave a comment

By Dan Caplinger, The Motley Fool

Filed under:

On Tuesday, US Bancorp will release its latest quarterly results. The key to making smart investment decisions on stocks reporting earnings is to anticipate how they’ll do before they announce results, leaving you fully prepared to respond quickly to whatever inevitable surprises arise. That way, you’ll be less likely to make an uninformed knee-jerk reaction to news that turns out to be exactly the wrong move.

US Bancorp occupies an interesting niche in the banking industry. As a superregional powerhouse, US Bancorp doesn’t quite rise to Wall Street-bank status, but it still has an important role to play in the national economy from its vantage in Minneapolis. How is the company competing against its larger peers? Let’s take an early look at what’s been happening with US Bancorp over the past quarter and what we’re likely to see in its quarterly report.

Stats on US Bancorp

Analyst EPS Estimate

$0.73

Change From Year-Ago EPS

9%

Revenue Estimate

$5.03 billion

Change From Year-Ago Revenue

2%

Earnings Beats in Past 4 Quarters

2

Source: Yahoo! Finance.

Can you bank on US Bancorp’s earnings this quarter?
Analysts have been fairly resolute in their expectations of US Bancorp’s earnings over the past few months, cutting their call for the just-ended quarter by just a penny per share and reducing full-year 2013 earnings-per-share estimates by $0.02. The stock has seen a similarly muted response, rising just 4% since early January.

As with most banks, the big news for US Bancorp over the past quarter was its having passed the Federal Reserve’s stress tests. The bank managed to improve its capital ratios by about half a percentage point compared with last year’s stress tests, posting a better stressed-ratio figure than many of its larger peers.

One reason US Bancorp performed so well is that it lacks the big mortgage and credit card exposure that Wall Street banks have. In the stress-test scenario, Bank of America stood to suffer 43% of its projected losses from mortgages, home equity loans, and other home-related loans. Citigroup had 24% exposure to home loans and a whopping 43% of losses from credit cards. But US Bancorp has a much more traditional banking business, with just 16% of projected losses from mortgages and 21% from credit cards. Regular commercial and consumer loans, including commercial real-estate-related loans, make up the bulk of US Bancorp’s potential loss exposure.

As a result of its stress-test results, US Bancorp got Fed permission to boost its dividend by 18%, giving it a yield of 2.7%. That’s not a huge amount, but it’s well above what B of A and Citi pay, especially as neither one sought to try to increase its token $0.01 quarterly payout.

In US Bancorp’s earnings report, watch for signs of how the middle-American economy is doing. While most economists focus on the coasts, US Bancorp’s

From: http://www.dailyfinance.com/2013/04/14/us-bancorp-seeks-to-start-growing-again/

Business, Finance, Occupation & Industry

CSX's Earnings Should Keep Chugging Along

Leave a comment

By Dan Caplinger, The Motley Fool

Filed under:

On Tuesday, CSX will release its latest quarterly results. The key to making smart investment decisions on stocks reporting earnings is to anticipate how they’ll do before they announce results, leaving you fully prepared to respond quickly to whatever inevitable surprises arise. That way, you’ll be less likely to make an uninformed knee-jerk reaction to news that turns out to be exactly the wrong move.

As a major railroad company, CSX has benefited from high energy prices in recent years that have made rail transportation a more efficient way of moving goods over long distances. But the decline in demand for commodities like coal has crimped the railroad‘s results lately. Let’s take an early look at what’s been happening with CSX over the past quarter and what we’re likely to see in its quarterly report.

Stats on CSX

Analyst EPS Estimate

$0.40

Change From Year-Ago EPS

(7%)

Revenue Estimate

$2.91 billion

Change From Year-Ago Revenue

(1.7%)

Earnings Beats in Past 4 Quarters

4

Source: Yahoo! Finance.

Will CSX fire up its engines this quarter?
Analysts have gotten more pessimistic about CSX‘s earnings over the past few months, as they’ve cut back on their estimates for the just-ended quarter by $0.03 per share and chopped $0.07 per share off their full-year 2013 consensus. But the stock has kept motoring ahead, climbing more than 20% since early January.

Railroads have done extremely well in recent years by capitalizing on the big boom in commodities demand, especially overseas. For CSX, coal was a big driver of its major efficiency gains, as more than 70% of coal delivered to electricity-generating power plants goes by rail. But when rock-bottom natural-gas prices led electric utilities to shift from coal to gas to fuel their power plants, CSX and many of its rivals took big hits. In particular, Norfolk Southern , with similar geographic exposure to the Appalachian coal-producing region, shared CSX‘s declines.

But CSX has a couple of options to pursue to rebound. One way would be to take advantage of growing export demand for coal, as natural-gas prices in other areas of the world are far less competitive than they are within the U.S., and low shipping costs make global coal transport economically viable. The other alternative is to borrow a page from other railroads and seek to transport cheap domestic oil by rail from hard-to-reach areas to existing refineries, especially on the East Coast. Union Pacific and Canadian National have found high demand for their services in the oil-producing areas of Alberta and the Bakken, and although CSX‘s home territory is better served by existing pipelines, it could nevertheless have an opportunity to boost demand by meeting other needs.

In CSX‘s earnings report, watch to see how the railroad responds to the growing trend toward considering relocation of manufacturing capacity back into the U.S., as

From: http://www.dailyfinance.com/2013/04/14/csxs-earnings-should-keep-chugging-along/

Business, Finance, Occupation & Industry

Goldman Sachs Seeks to Start Growing Again

Leave a comment

By Dan Caplinger, The Motley Fool

Filed under:

Next Tuesday, Goldman Sachs will release its latest quarterly results. The key to making smart investment decisions on stocks reporting earnings is to anticipate how they’ll do before they announce results, leaving you fully prepared to respond quickly to whatever inevitable surprises arise. That way, you’ll be less likely to make an uninformed kneejerk reaction to news that turns out to be exactly the wrong move.

Goldman Sachs has recovered strongly from the worst of the financial crisis more than four years ago, but it hasn’t managed to overcome all of the obstacles in its path. With the threat of heightened regulation, the company’s earnings haven’t grown as quickly as investors would like. Let’s take an early look at what’s been happening with Goldman Sachs over the past quarter and what we’re likely to see in its quarterly report.

Stats on Goldman Sachs

Analyst EPS Estimate

$3.84

Change From Year-Ago EPS

(2%)

Revenue Estimate

$9.60 billion

Change From Year-Ago Revenue

(3.5%)

Earnings Beats in Past 4 Quarters

4

Source: Yahoo! Finance.

Will Goldman Sachs crush estimates again this quarter?
Analysts have gotten a lot more excited about Goldman’s prospects over the past few months, as they’ve raised their estimates for the just-ended quarter by more than 10%, or $0.36 per share. Moreover, analysts have been even more optimistic about Goldman’s prospects for the rest of 2013, as their consensus earnings estimate has soared by more than $1 per share. That enthusiasm has translated into gains for Goldman’s stock, which has risen more than 11% since early January.

Arguably, Goldman’s big news for the quarter came from the stress tests. The company boosted its tier 1 common ratio by a full percentage point over the past year, yet while Goldman passed the tests, that extra capital didn’t translate into any stronger of a cushion for its “stressed minimum” capital ratio result. Indeed, both it and Morgan Stanley posted the lowest passing scores on that metric, showing the difficulty that investment-oriented banks have in satisfying the Fed about their stability.

Moreover, the Fed wasn’t satisfied with Goldman’s proposed capital plan, asking the bank to resubmit its plan to take other factors into account. JPMorgan Chase faced a similar restriction, although it plans to move ahead with its decision to boost its dividend by 27% and make a $6 billion stock buyback. Goldman hasn’t disclosed its capital intentions at this point, but with a dividend yield of just 1.3%, shareholders certainly hope that a boost to its payout will come in the near future.

One concern that arose in the past month is the extent to which Goldman is baldly moving forward with attempts to get around stricter regulation. In a filing for its proposed business development company, Liberty Harbor Capital, Goldman specifically mentioned its intent to “take advantage of specified reduced reporting and other

From: http://www.dailyfinance.com/2013/04/12/goldman-sachs-seeks-to-start-growing-again/

Business, Finance, Occupation & Industry

Johnson & Johnson Earnings Could Send the Dow Higher Still

Leave a comment

By Dan Caplinger, The Motley Fool

Filed under:

Earnings season has begun, and next Tuesday Johnson & Johnson will release its latest quarterly results. The key to making smart investment decisions on stocks reporting earnings is to anticipate how they’ll do before they announce results, leaving you fully prepared to respond quickly to whatever inevitable surprises arise. That way, you’ll be less likely to make an uninformed, knee-jerk decision.

Johnson & Johnson is a behemoth in the health care space, with a business that includes not only its well-known consumer health and personal-care products, but also a thriving pharmaceutical business and an extensive line of medical devices. The breadth of its offerings has given it a place among the Dow Jones Industrials . However, with so much going on at J&J, can the company hold itself together and take advantage of new growth opportunities? Let’s take an early look at what’s been happening with Johnson & Johnson over the past quarter and what we’re likely to see in its quarterly report.

Stats on Johnson & Johnson

Analyst EPS Estimate

$1.40

Change From Year-Ago EPS

2.2%

Revenue Estimate

$17.46 billion

Change From Year-Ago Revenue

8.2%

Earnings Beats in Past 4 Quarters

4

Source: Yahoo! Finance.

Will Johnson & Johnson make investors feel healthy this quarter?
In recent months, analysts have had mixed views on Johnson & Johnson’s earnings prospects. They’ve raised their consensus on the just-finished quarter by a penny per share, but they’ve pulled back on their full-year 2013 EPS outlook by $0.08 and cut 2014 estimates even more sharply. Yet the stock continues to perform well, rising more than 15% since early January.

Lately, Johnson & Johnson has presented two different faces to investors. On one hand, the company has faced the challenge of dealing with a weak consumer-products business, as multiple recalls and close regulatory oversight of its production facilities have exacerbated J&J’s problems. With its more focused consumer-goods business, Colgate-Palmolive has worked harder at taking advantage of international growth opportunities than many of its rivals, and Colgate’s strong overseas sales, in comparison to J&J’s international weakness, show the effectiveness of that strategy. In particular, Asia has been a focus point for Colgate, with revenue from the region having risen 9% year over year compared with less than 3% growth overall. Moreover, Latin America represents Colgate’s biggest region for sales, with more than half again the revenue its U.S. segment produces.

Yet in the pharmaceutical space, J&J has had great success. The approval of its Invokana treatment for type 2 diabetes bodes well for the company, as Invokana’s approach to treating the disease is completely different from that of competing products. In particular, Merck‘s Januvia appears to have some substantial disadvantages compared to the drug, and with Januvia’s patent set to expire in a few years, Invokana could have an even clearer path to success in the future. J&J

From: http://www.dailyfinance.com/2013/04/11/johnson-johnson-earnings-could-send-the-dow-higher/

Business, Finance, Occupation & Industry

Will Schwab's Recent Moves Pay Off?

Leave a comment

By Dan Caplinger, The Motley Fool

Filed under:

Earnings season has begun, and next Monday, Charles Schwab will release its latest quarterly results. The key to making smart investment decisions on stocks reporting earnings is to anticipate how they’ll do before they announce results, leaving you fully prepared to respond quickly to whatever inevitable surprises arise. That way, you’ll be less likely to make an uninformed kneejerk reaction to news that turns out to be exactly the wrong move.

Schwab has been a longtime leader in the discount brokerage space, taking advantage of the rise of the Internet to offer a wide array of services to customers. Yet the market meltdown hurt its core business in several ways, and the company has had to work hard to recover ever since. Let’s take an early look at what’s been happening with Schwab over the past quarter and what we’re likely to see in its quarterly report.

Stats on Schwab

Analyst EPS Estimate

$0.16

Change From Year-Ago EPS

6.7%

Revenue Estimate

$1.27 billion

Change From Year-Ago Revenue

6.5%

Earnings Beats in Past 4 Quarters

2

Source: Yahoo! Finance.

Will Schwab benefit from market records this quarter?
Analysts have had mixed views on Schwab’s earnings lately. In the past month, they’ve cut their consensus for the just-ended quarter by $0.01 per share, but they boosted their full-year 2013 calls by a penny per share as well. Investors have gotten more optimistic lately, with the stock up 13% since early January.

Schwab has done its best to capitalize on increased interest in investing in light of the big run-up in the stock market. In January, the company topped $2 trillion in total client assets for the first time ever, and as of February, it had seen a 13% jump in assets. Yet trading activity remains muted, with just a 1% year-over-year increase in daily average trades.

In order to encourage greater investor participation, Schwab recently boosted its presence in the red-hot exchange-traded fund market. Schwab pioneered commission-free ETF investing more than three years ago, but since then, rivals had cut into Schwab’s minimalist lineup of proprietary ETFs with broader deals. TD AMERITRADE  had issued a lineup of more than 100 no-commission ETFs from various fund families, drawing investors interested in greater variety of funds. In response, Schwab came out with its ETF OneSource platform, topping TD Ameritrade with 105 ETFs.

The big potential for Schwab lies in going after 401(k) accounts. Currently, mutual funds dominate 401(k) plan investment options, but ETFs are making inroads into the multitrillion-dollar industry. Despite existing competition from TD AMERITRADE and Capital One‘s ShareBuilder — and with Fidelity’s recent expansion of its ETF partnership with BlackRock‘s iShares unit signaling another potential entrant to the space — Schwab’s plans to launch an all-ETF 401(k) plan next year could tap a larger part of a lucrative market.

In Schwab’s quarterly report, look for more

From: http://www.dailyfinance.com/2013/04/11/will-schwabs-recent-moves-pay-off/

Business, Finance, Occupation & Industry

Citigroup Earnings: An Early Look

Leave a comment

By Dan Caplinger, The Motley Fool

Filed under:

Earnings season has begun, and next Monday, Citigroup will release its latest quarterly results. The key to making smart investment decisions on stocks reporting earnings is to anticipate how they’ll do before they announce results, leaving you fully prepared to respond quickly to whatever inevitable surprises arise. 

Citigroup has come a long way from the depths of the financial crisis, having managed to survive with the help of government assistance. Yet despite a big move in its stock over the past year, Citigroup still languishes below its levels from 2010 and 2011, let alone its loftier pre-crisis prices. Let’s take an early look at what’s been happening with Citigroup over the past quarter and what we’re likely to see in its quarterly report.

Stats on Citigroup

Analyst EPS Estimate

$1.18

Change From Year-Ago EPS

6.3%

Revenue Estimate

$20.1 billion

Change From Year-Ago Revenue

3.6%

Earnings Beats in Past 4 Quarters

3

Source: Yahoo! Finance.

Can Citigroup get back on the right foot this quarter?
Analysts haven’t been too excited recently about Citigroup’s earnings prospects, as they cut their earnings-per-share consensus for the just-ended quarter by $0.07. They don’t see the bank making up the difference during the rest of 2013, having cut their full-year views by $0.06 per share. Yet all of that negativity hasn’t hit the stock at all, which has jumped more than 7% since early January.

Citigroup has had a lot of good news lately. Most notably, Citi passed the Fed’s latest round of stress tests with an extremely strong capital position, readying it to survive the Fed’s stress scenario without further need to raise additional funds. With its minimum capital ratio of 8.3% under the stress tests, Citigroup bested JPMorgan Chase by two full percentage points and topped rivals Bank of America and Wells Fargo by more than a percentage point as well.

Moreover, Citi also benefited from the dismissal of antitrust and other claims related to last year’s LIBOR scandal. Citi, B of A, and JPMorgan were among those requesting the dismissal last year, and a court found that LIBOR wasn’t intended to be a competitive market and, therefore, that anti-competition laws didn’t apply.

Yet Citigroup disappointed investors somewhat by choosing not to ask the Fed for permission to raise its dividend from its token $0.01 quarterly payout. Given its improved condition, Citi most likely could have gotten permission for a larger dividend. Yet with new CEO Michael Corbat seeking to cement his reputation as a traditional banker, the decision is consistent with projecting an image of safety and security.

One reason for the conservative stance may be that Citigroup still faces some potential problems. A couple weeks ago, the company had a federal judge question Citigroup’s proposed settlement of claims related to investor allegations that the bank should have written down subprime mortgage-backed assets earlier than it

From: http://www.dailyfinance.com/2013/04/11/citigroup-earnings-an-early-look/

Business, Finance, Occupation & Industry

JPMorgan Earnings: An Early Look

Leave a comment

By Dan Caplinger, The Motley Fool

Filed under:

Earnings season has begun, and on Friday JPMorgan Chase will release its latest quarterly results. The key to making smart investment decisions on stocks reporting earnings is to anticipate how they’ll do before they announce results, leaving you fully prepared to respond quickly to whatever inevitable surprises arise. That way you’ll be less likely to make an uninformed, knee-jerk decision.

As a key financial stock in the Dow Jones Industrial Average , JPMorgan has held up reasonably well in the aftermath of the financial crisis, but it has also suffered some high-profile problems, most notably the infamous “London Whale” trading debacle that cost the bank billions of dollars. Can the JPMorgan stay on the road to a full recovery? Let’s take an early look at what’s been happening with JPMorgan over the past quarter and what we’re likely to see in its quarterly report.

Stats on JPMorgan

Analyst EPS Estimate

$1.39

Change From Year-Ago EPS

17%

Revenue Estimate

$25.94 billion

Change From Year-Ago Revenue

(5.4%)

Earnings Beats in Past 4 Quarters

4

Source: Yahoo! Finance.

Can you bank on JPMorgan this quarter?
In recent months, analysts have gotten a lot more bullish on JPMorgan’s earnings prospects. They’ve boosted their earnings estimates for the just-ended quarter by a nickel per share and raised their full-year 2013 projections by an even more substantial $0.17 per share. The stock has performed well in response, with a 10% gain since early January.

JPMorgan has grown much healthier since the days of the financial crisis. In JPMorgan’s stress test results last month, the bank got approval from the Federal Reserve to boost its dividend by more than 25% and buy back $6 billion in shares in the next year. In a minor setback, the Fed’s approval was conditional on the bank’s improving its capital plan to strengthen its planning procedures. Yet JPMorgan is still well ahead of Bank of America and Citigroup in their respective recoveries. For their part, B of A and Citigroup chose not to pursue a dividend increase despite their greatly improved capital conditions, leaving their investors stuck at a $0.01 per-share quarterly payout.

JPMorgan has been doing its best to put its past difficulties behind it. Earlier this month, the bank had the bulk of the claims against it thrown out of court in connection with mortgage-backed securities that JPMorgan had sold to European bank Dexia. It also came to a settlement in the MF Global case worth more than $500 million, which will go a long way toward restoring customers’ lost account balances in the debacle. Even with ongoing liability from its acquisition of Bear Stearns in 2008, JPMorgan has moved ahead in reducing its potential outlays in the future.

Perhaps the biggest liability break came from the dismissal of lawsuits surrounding last year’s LIBOR scandal. Although JPMorgan would

Source: FULL ARTICLE at DailyFinance

Business, Finance, Occupation & Industry

Pier 1 Earnings: An Early Look

Leave a comment

By Dan Caplinger, The Motley Fool

Filed under:

Earnings season has begun, and on Thursday, Pier 1 Imports will release its latest quarterly results. The key to making smart investment decisions on stocks reporting earnings is to anticipate how they’ll do before they announce results, leaving you fully prepared to respond quickly to whatever inevitable surprises arise. That way, you’ll be less likely to make an uninformed knee-jerk reaction to news that turns out to be exactly the wrong move.

Pier 1 has recovered from the brink of collapse during the bear market of 2008 and early 2009, and now, its stock is approaching all-time highs. Will the bounce in the housing market provide the catalyst Pier 1 needs to break to record levels? Let’s take an early look at what’s been happening with Pier 1 over the past quarter and what we’re likely to see in its quarterly report.

Stats on Pier 1

Analyst EPS Estimate

$0.60

Change From Year-Ago EPS

25%

Revenue Estimate

$551.4 million

Change From Year-Ago Revenue

16%

Earnings Beats in Past 4 Quarters

1

Source: Yahoo! Finance.

Will Pier 1 give investors what they want this quarter?
Analysts haven’t budged much on their views of Pier 1’s earnings prospects over the past few months. They’ve held steady on their calls for the most-recent holiday quarter, and they shaved a penny per share from their full-year fiscal 2014 consensus. But the stock has done quite well, rising more than 13% since early January.

The reason for Pier 1’s strong performance lately is pretty simple: Demand for new homes has picked up, and when buyers move into a new home, they tend to buy home furnishings to go with it. Higher-end retailer Williams-Sonoma already announced solid results for its holiday quarter, especially citing growth in its home-furnishings segments as a big contributor to its overall results.

But last month, Pier 1 gave mixed guidance on its holiday quarter. Although it saw same-store sales gain almost 8% for the quarter, its earnings-per-share projections were somewhat disappointing, sending shares temporarily lower. More recently, mixed housing data has left the stock trading more turbulently.

The real key for the entire home-furnishings business is how they respond to the threat of online competition. Bed Bath & Beyond has been relatively slow to ramp up its Internet-based business, and as a result, it was recently named in a study on showrooming as the most vulnerable to online competitors. For its part, Pier 1 has reinvigorated its Internet-based sales recently, creating a barrier against online retailers who could take away its market share.

In Pier 1’s quarterly report, watch closely for signs of where Pier 1’s sales are coming from. If the company can see growth in its Internet business, it will demonstrate further evidence that the retailer has carved out a niche it can defend in the future.

The best investing approach is …read more

Source: FULL ARTICLE at DailyFinance

Business, Finance, Occupation & Industry

Infosys Earnings: An Early Look

Leave a comment

By Dan Caplinger, The Motley Fool

Filed under:

Earnings season has begun. On Thursday, Infosys will release its latest quarterly results. The key to making smart investment decisions on stocks reporting earnings is to anticipate how they’ll do before they announce results, leaving you fully prepared to respond quickly to whatever inevitable surprises arise.

Infosys was the poster child for the outsourcing trend during its initial rise to prominence, but the IT services company has emerged as a powerhouse in its own right. But as emerging-market growth has slowed, will Infosys be able to hold onto its growth? Let’s take an early look at what’s been happening with Infosys over the past quarter and what we’re likely to see in its quarterly report.

Stats on Infosys

Analyst EPS Estimate

$0.74

Change From Year-Ago EPS

(8.6%)

Revenue Estimate

$1.99 billion

Change From Year-Ago Revenue

12.3%

Earnings Beats in Past 4 Quarters

1

Source: Yahoo! Finance.

Will Infosys keep serving up profits to investors?
In recent months, analysts have changed their views on Infosys in both directions, cutting their estimates on the just-ended quarter’s earnings by $0.01 per share but boosting their full-year fiscal 2014 calls by $0.05. The stock, though, has seen a positive move, with the shares up more than 20% since the beginning of the year.

For years, Infosys benefited from the trend toward outsourcing IT services rather than attempting to manage technology in-house. Yet recently, Infosys hasn’t been as certain about its future, as it reined in its enthusiasm in its otherwise favorable report last quarter by giving only “cautiously optimistic” guidance about its first-quarter prospects. Rival Accenture noted that its growth rate in its Asia-Pacific region was much slower than its Americas-based growth, although its outsourcing business overall has been much healthier than its general consulting segment.

Infosys has faced increased competition coming from both the U.S. and Southeast Asia. Accenture’s outsourcing business is a major rival, but domestically focused Cognizant Technologies has also done its best to play to its home-field advantage by attracting U.S. customers seeking to keep their outsourcing closer to home. Meanwhile, Indian firm Wipro is still a big rival for Infosys in its home market, as it competes for talent and acts as a check on Infosys’s ability to take advantage of cheaper Indian labor costs to widen its profit margins.

In an interesting twist, Infosys announced last month that it would insource jobs back into the U.S. by adding 200 new staffers in its facility near Atlanta. Given the growth that the southeastern U.S. has experienced over the past decade, Infosys has targeted a lucrative area for expansion, and it expects additional job openings in the near future.

In its earnings report, watch for Infosys to provide a gauge not just of its own business but of the IT outsourcing and consulting markets generally. Any jump in activity could bode well …read more

Source: FULL ARTICLE at DailyFinance

Business, Finance, Occupation & Industry

Rite Aid Earnings: An Early Look

Leave a comment

By Dan Caplinger, The Motley Fool

Filed under:

Earnings season has begun, and on Thursday, Rite Aid will release its latest quarterly results. The key to making smart investment decisions on stocks reporting earnings is to anticipate how they’ll do before they announce results, leaving you fully prepared to respond quickly to whatever inevitable surprises arise. That way, you’ll be less likely to make an uninformed knee-jerk reaction to news that turns out to be exactly the wrong move.

Rite Aid has been the third wheel of the U.S. drugstore industry for a long time, as it has struggled to reach profitability even as its main rivals have seen substantial growth in sales and earnings over the years. Can Rite Aid ever recover? Let’s take an early look at what’s been happening with Rite Aid over the past quarter and what we’re likely to see in its quarterly report.

Stats on Rite Aid

Analyst EPS Estimate

($0.02)

Year-Ago EPS

($0.18)

Revenue Estimate

$6.45 billion

Change From Year-Ago Revenue

(9.8%)

Earnings Beats in Past 4 Quarters

3

Source: Yahoo! Finance.

Does Rite Aid have the right prescription for its business?
Analysts have had mixed views on Rite Aid‘s prospects over the past few months. They’ve cut their initial break-even estimates for the company’s most recent quarter to a loss of $0.02 per share, but they’ve also boosted fiscal 2014 earnings estimates to a profit of $0.03 per share. The stock has focused on the longer-term view, as Rite Aid‘s share price has jumped more than 30% since the beginning of the year.

For a while last year, it looked as if Rite Aid might finally be turning the corner after a long period of weakness. A dispute between rival Walgreen and pharmacy benefit manager Express Scripts led to an exodus of customers away from Walgreen, and Rite Aid appeared to capture its share of those seeking to have their prescriptions filled elsewhere.

Since then, though, Rite Aid has sunk back into old bad habits. In March, it announced a 2% drop in same-store sales, with a drop in pharmacy sales of 4.5% more than offsetting a nearly 4% increase in revenue from the front-end of its stores. Yet even that front-end strength came largely from Easter’s coming in March rather than April this year, suggesting that the retailer’s results were even weaker than reported. Meanwhile, Walgreen has seen same-store sales grow as its new loyalty program attempts to win back customers from Rite Aid and CVS Caremark .

Rite Aid has fought back, though, seeking to match up to Walgreen and CVS by remodeling its stores. But because it is already debt-ridden, Rite Aid can’t afford to do store remodeling at a very fast pace, with Fool contributor Adam Levine-Weinberg arguing that it could take a decade for the company to finish all of its renovations.

In Rite Aid‘s quarterly report, watch for …read more

Source: FULL ARTICLE at DailyFinance

Business, Finance, Occupation & Industry

Wells Fargo Earnings: An Early Look

Leave a comment

By Dan Caplinger, The Motley Fool

Filed under:

Earnings season has begun, and on Friday, Wells Fargo will release its latest quarterly results. The key to making smart investment decisions on stocks reporting earnings is to anticipate how they’ll do before they announce results, leaving you fully prepared to respond quickly to whatever inevitable surprises arise. That way, you’ll be less likely to make an uninformed, kneejerk reaction that turns out to be exactly the wrong response to the news.

Even in the much-maligned banking sector, Wells Fargo has a strong reputation for having minimized its own damage from the mortgage meltdown, inheriting most of its problems when it bought out Wachovia during the financial crisis in 2008. Since then, the bank has worked hard to resolve those problems. Let’s take an early look at what’s been happening with Wells Fargo over the past quarter and what we’re likely to see in its quarterly report.

Stats on Wells Fargo

Analyst EPS Estimate

$0.88

Change From Year-Ago EPS

17%

Revenue Estimate

$21.6 billion

Change From Year-Ago Revenue

(0.2%)

Earnings Beats in Past 4 Quarters

4

Source: Yahoo! Finance.

Can Wells Fargo prove analysts wrong again this quarter?
In recent months, analysts have gotten more optimistic about Wells Fargo‘s earnings prospects, upgrading their earnings estimates for the just-ended quarter by a penny per share and adding $0.03 to their EPS calls for full-year 2013. The stock has performed reasonably well, rising about 6% since early January.

Wells Fargo has a strong reputation among big banks for its relatively drama-free performance. With its status as the No. 4 bank in the country by assets and carrying the seal of approval from Warren Buffett, Wells has treated shareholders well lately, providing good returns and boosting its dividend earlier this year. Moreover, after passing the Fed’s stress tests last month, a further 20% increase in its payout appears imminent

But one big challenge that Wells Fargo will start to face this quarter is in mortgage lending. Although the fact that housing prices have apparently hit bottom is an encouraging sign, slight rises in interest rates could put a halt to refinancing activity. That in turn will force banks to seek more of the transaction-based revenue that has helped them recover so strongly, and they’ll need to get it from new homebuyers rather than existing homeowners seeking lower mortgage rates from new loans. Although JPMorgan Chase has also been a big player in the mortgage market, Wells outpaced JPMorgan’s home-loan volume by nearly 150% in the fourth quarter of 2012, showing the extent of Wells Fargo‘s reliance on the segment for its overall profits.

Another concern is the return of subprime lending, this time in the auto-loan market. Both Wells Fargo and Bank of America have made it easier for customers …read more

Source: FULL ARTICLE at DailyFinance

Business, Finance, Occupation & Industry

Constellation Brands Earnings: An Early Look

Leave a comment

By Dan Caplinger, The Motley Fool

Filed under:

Spring is finally here, and a new earnings season is getting under way. On Wednesday, Constellation Brands will release its latest quarterly results. The key to making smart investment decisions on stocks reporting earnings is to anticipate how they’ll do before they announce results, leaving you fully prepared to respond quickly to whatever inevitable surprises arise. That way, you’ll be less likely to make an uninformed knee-jerk reaction to news that turns out to be exactly the wrong move.

Constellation Brands has been at the center of the frenzy of consolidation that’s been going on in the beer, wine, and spirits industry recently. Can the company hold its own against increasingly tough competition on a number of fronts? Let’s take an early look at what’s been happening with Constellation Brands over the past quarter and what we’re likely to see in its quarterly report on Wednesday.

Stats on Constellation Brands

Analyst EPS Estimate

$0.45

Change From Year-Ago EPS

(35%)

Revenue Estimate

$667 million

Change From Year-Ago Revenue

6.1%

Earnings Beats in Past 4 Quarters

4

Source: Yahoo! Finance.

Can Constellation Brands lift investors’ spirits this quarter?
Analysts have gotten more optimistic about Constellation’s earnings prospects in recent months, as they’ve lifted their estimates both for the just-ended quarter and for the entire 2013 fiscal year. That optimism has definitely shown up in Constellation’s share price, as the stock has risen 35% just since the beginning of the year.

For almost a year now, Constellation has been dealing with the changing prospects of Anheuser-Busch‘s attempts to buy Grupo Modelo. To avoid antitrust concerns, Anheuser-Busch had agreed to sell its stake in the Crown Imports joint venture to Constellation, giving it complete control of Crown Imports. Moreover, the deal would also have allowed Constellation to import Corona and Modelo Especial.

Since it was initially proposed, the Grupo Modelo deal has gone through big ups and downs. In early February, the Justice Department blocked the deal, arguing that Anheuser-Busch would have too much pricing control if the deal went through. Yet just a couple of weeks later, a new agreement that added in Constellation’s taking over Grupo Model’s Piedras Negras brewery for $2.9 billion seemed to satisfy the Justice Department, and shares soared as the deal appears to be back on.

Nevertheless, Constellation Brands hasn’t been standing still waiting for Anheuser-Busch to figure out how to get its deal done. Last month, Constellation moved forward with a distribution deal with Brazil’s Interfood Importacao, whereby the local company will offer Robert Mondavi wine, Svedka vodka, and other products throughout the South American giant. The move is just the latest in Constellation’s attempts to bolster its emerging-market presence.

In its earnings report, watch for Constellation to report on the status of the Anheuser-Busch deal as well as its other strategic moves. If the deal finally gets done, the future looks …read more

Source: FULL ARTICLE at DailyFinance

Business, Finance, Occupation & Industry

Family Dollar Earnings: An Early Look

Leave a comment

By Dan Caplinger, The Motley Fool

Filed under:

Spring is finally here, and a new earnings season is right around the corner. On Wednesday, Family Dollar will release its latest quarterly results. The key to making smart investment decisions on stocks reporting earnings is to anticipate how they’ll do before they announce results, leaving you fully prepared to respond quickly to whatever inevitable surprises arise. That way, you’ll be less likely to make an uninformed, knee-jerk reaction to news that turns out to be exactly the wrong move.

The deep-discount industry has seen huge growth in recent years, as a sluggish economic recovery has left millions of Americans behind, struggling to make ends meet. Yet highly competitive conditions in the industry have left Family Dollar fighting with a number of peers for market share. Let’s take an early look at what’s been happening with Family Dollar over the past quarter and what we’re likely to see in its quarterly report on Wednesday.

Stats on Family Dollar

 

  

Analyst EPS Estimate

$1.23

Change From Year-Ago EPS

7%

Revenue Estimate

$2.89 billion

Change From Year-Ago Revenue

17.6%

Earnings Beats in Past 4 Quarters

1

Source: Yahoo! Finance.

Is Family Dollar’s stock its best bargain?
Analysts have gotten more pessimistic about Family Dollar‘s earnings in recent months, as they’ve cut their estimates on the just-ended quarter by $0.04 per share and notched $0.09 off full-year fiscal 2013 earnings-per-share figures. The stock has reflected that dour view, dropping 6% since the beginning of the year.

After years of strength, Family Dollar has recently found itself on shakier ground. The same slow economic conditions that led to its strong performance during the 2008 recession continue to exist today, but now, even deep-discount retailers have proven vulnerable to tough times among its customers.

In particular, a combination of rising payroll taxes, higher prices at the pump, and weak employment growth has held spending back among lower-income shoppers. Wal-Mart‘s tepid 1% rise in same-store sales in the U.S. might have been good news for Family Dollar in years past, but Family Dollar‘s move toward more food items has put margins under pressure, and the stock hasn’t responded favorably.

Perhaps most troubling for Family Dollar are the moves that its competitors are making. Dollar General has done its best to hold off rising competition by aggressively expanding, with plans to open 635 new stores this year. The move could hurt short-term margins, but it throws down the gauntlet for Family Dollar to keep up the pace. Meanwhile, Dollar Tree reported surprisingly strong results in its most recent quarter as its cost-cutting bore fruit for investors.

In Family Dollar‘s quarterly report, watch for the company to address how it plans to respond to Dollar General‘s aggressive expansion plans. In this increasingly dog-eat-dog industry, Family Dollar can’t afford to let its rivals get too far ahead if it wants to retain its leadership …read more

Source: FULL ARTICLE at DailyFinance

Business, Finance, Occupation & Industry

Jinko Solar Earnings: An Early Look

Leave a comment

By Dan Caplinger, The Motley Fool

Filed under:

Spring is finally here, and a new earnings season is right around the corner. On Wednesday, Jinko Solar will release its latest quarterly results. The key to making smart investment decisions on stocks reporting earnings is to anticipate how they’ll do before they announce results, leaving you fully prepared to respond quickly to whatever inevitable surprises arise. That way, you’ll be less likely to make an uninformed knee-jerk reaction to news that turns out to be exactly the wrong move.

Chinese solar stocks have struggled especially hard lately, as a glut of capacity has made many players in the industry unprofitable. Jinko Solar actually earned an annual profit as recently as 2011, but its fortunes have reversed with most of its peers. Let’s take an early look at what’s been happening with Jinko Solar over the past quarter and what we’re likely to see in its quarterly report on Wednesday.

Stats on Jinko Solar

Analyst EPS Estimate

($0.80)

Year-Ago EPS

($2.58)

Revenue Estimate

$244.5 million

Change From Year-Ago Revenue

28%

Earnings Beats in Past 4 Quarters

1

Source: Yahoo! Finance.

Can Jinko Solar shine this quarter?
As dire as Jinko’s earnings appear, analysts haven’t gotten any more pessimistic about them in recent months, keeping their consensus views stable both for its most recent quarter and for full-year 2013. But the stock hasn’t been as fortunate, as it has lost a third of its value since the beginning of 2013.

Solar companies in China have largely survived poor conditions in the industry due to the generosity of government subsidies. Last December, China‘s Ministry of Finance set aside $1.1 billion in solar subsidies, while the Ministry of Science and Technology said it would provide subsidies to 100 different companies. While those subsidies help the industry as a whole, they don’t help shake out weaker players from the industry.

But Jinko may have an inside track to survival. The company got a $1 billion loan from the China Development Bank to help it with European solar projects. With a stronger balance sheet than many of its peers, Jinko appears better poised to survive the inevitable shakeout, while LDK Solar and Yingli Green Energy struggle under more substantial debt burdens. Already, the bankruptcy of Suntech Power has shown that China won’t rescue investors in every solar company.

Still, the fundamental problem in the industry is that capacity far exceeds demand. U.S. giant SunPower has a huge efficiency lead over its rivals, making it most likely to capture its share of the 30 gigawatts of demand that companies with 70 gigawatts of capacity are fighting over. Similarly, First Solar has found ways to remain profitable even with challenges from subsidy-supported Chinese rivals.

In its earnings report, watch carefully for Jinko to comment on the impact of the Suntech bankruptcy on its business. If Jinko can capture …read more

Source: FULL ARTICLE at DailyFinance

Business, Finance, Occupation & Industry

NovaGold Earnings: An Early Look

Leave a comment

By Dan Caplinger, The Motley Fool

Filed under:

Spring is finally here, and a new earnings season is right around the corner. On Wednesday, NovaGold Resources will release its latest quarterly results. The key to making smart investment decisions on stocks reporting earnings is to anticipate how they’ll do before they announce results, leaving you fully prepared to respond quickly to whatever inevitable surprises arise. That way, you’ll be less likely to make an uninformed knee-jerk reaction to news that turns out to be exactly the wrong move.

Gold mining stocks have gotten crushed over the past year, as a combination of weak bullion prices and cost-related struggles have led to intense pressure throughout the industry. Yet NovaGold has gotten the attention of hedge-fund investors John Paulson and Seth Klarman, who have taken sizable stakes in the company. Let’s take an early look at what’s been happening with NovaGold over the past quarter and what we’re likely to see in its quarterly report.

Stats on NovaGold Resources

Analyst EPS Estimate

($0.03)

Year-Ago EPS

$0.07

Revenue Estimate

$0

Year-Ago Revenue

$0

Earnings Beats in Past 4 Quarters

2

Source: S&P Capital IQ.

Will NovaGold Resources shine brighter this quarter?
It’s hard for analysts to get too excited about NovaGold because it hasn’t reported even minimal revenue since 2010. The single price target on the stock of $17.10 is wildly out of line with its current price, and shareholders have taken a substantial hit lately, with the stock having lost a quarter of its value since the beginning of the year.

NovaGold has several promising development-stage mining properties in its portfolio, although none of them has gotten to the production stage at this point. The company claims its Donlin Gold joint venture with Barrick Gold in Alaska is the world’s largest known undeveloped gold deposit, with project permitting having begun last August. Moreover, its Galore Creek venture with Teck Resources in British Columbia has promising prospects for copper, silver, and gold.

But the big problem that NovaGold has faced is that high production costs have made those projects less economically viable. Last summer, Barrick said that Donlin no longer met its goals for suitable investments because of substantial needs for capital, and although the permitting process has continued, it’s far from certain whether Barrick would be willing to go forward even if the project is approved. Meanwhile, NovaGold has said it would try to sell its 50% interest in Galore Creek, but the company has only been willing to enhance the project’s value on a reduced budget.

Meanwhile, NovaGold’s capital structure is becoming more precarious. Earlier this month, the company sent notice to its convertible bond holders that they could exercise their rights to sell the bonds back to NovaGold at par. NovaGold has enough cash to cover its repurchase of any bonds that investors offer, but with no revenue, it definitely …read more

Source: FULL ARTICLE at DailyFinance

Business, Finance, Occupation & Industry

CarMax Earnings: An Early Look

Leave a comment

By Dan Caplinger, The Motley Fool

Filed under:

Spring is finally here, and a new earnings season is right around the corner. On Wednesday, CarMax will release its latest quarterly results. The key to making smart investment decisions on stocks reporting earnings is to anticipate how they’ll do before they announce results, leaving you fully prepared to respond quickly to whatever inevitable surprises arise. That way, you’ll be less likely to make an uninformed knee-jerk reaction to news that turns out to be exactly the wrong move.

In an industry where finding the car you really want can be a nearly impossible challenge, CarMax sought out to make car-buying a lot easier. Initially focusing on used cars, CarMax now offers both new and used vehicles of all makes and models at one store. Let’s take an early look at what’s been happening with CarMax over the past quarter and what we’re likely to see in its quarterly report on Wednesday.

Stats on CarMax

Analyst EPS Estimate

$0.46

Change From Year-Ago EPS

12.2%

Revenue Estimate

$2.73 billion

Change From Year-Ago Revenue

10.4%

Earnings Beats in Past 4 Quarters

2

Source: Yahoo! Finance.

Will CarMax drive higher this quarter?
Analysts have been guardedly optimistic about CarMax in recent months, having raised their estimates for the just-ended quarter by a penny per share. Although they’ve kept their fiscal 2013 and 2014 consensus stable, the stock has responded positively, jumping more than 10% since the beginning of the year.

For years, CarMax has been dealing with a challenging environment for used cars. During the recession, the government’s Cash for Clunkers program took a lot of used-car inventory off the market, leading to higher prices for used cars and thereby sending CarMax’s sales plunging in 2009. Moreover, car owners held onto their vehicles longer, temporarily delaying sales for car dealers.

But more recently, conditions have started to turn in the industry. The recovery has accelerated somewhat, and strong sales of new autos have trickled down to the used-car market as well. Both CarMax and rival AutoNation have notched new all-time highs, as those who put off car purchases have finally started to have to deal with the reality of aging vehicles costing more than they’re worth to maintain.

Still, competition is fierce in the dealership area. AutoNation is moving forward with plans to create a unified brand, giving up what used to be locally named dealerships in favor of a more concentrated marketing approach. Moreover, even Costco has gotten involved in the car-selling business, offering an online research tool that will help facilitate contact between customers and Costco-approved dealers at a pre-negotiated price. Given how much of CarMax’s appeal is its no-haggle policy, rival programs with the same benefits pose a true threat.

In CarMax’s quarterly report, look closely at the company’s latest sales figures. They’ll be valuable not just for investors in the stock but also as …read more

Source: FULL ARTICLE at DailyFinance