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Bed Bath & Beyond Earnings: An Early Look

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By Dan Caplinger, The Motley Fool

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Spring is finally here, and a new earnings season is right around the corner. Next Wednesday, Bed Bath & Beyond 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.

Bed Bath & Beyond has become the preeminent big-box retailer specializing in home furnishings and accessories, having beaten out former rival Linens ‘n Things in the bricks-and-mortar portion of the industry. Yet like most retailers, online competition is a big threat. Let’s take an early look at what’s been happening with Bed Bath & Beyond over the past quarter and what we’re likely to see in its quarterly report on Wednesday.

Stats on Bed Bath & Beyond

Analyst EPS Estimate

$1.68

Change From Year-Ago EPS

13.5%

Revenue Estimate

$3.39 billion

Change From Year-Ago Revenue

24%

Earnings Beats in Past 4 Quarters

3

Source: Yahoo! Finance.

Can Bed Bath & Beyond bring home great results?
Analysts have been resolute in their views on Bed Bath & Beyond recently, as they’ve kept their consensus estimates for the retailer’s quarterly earnings stable and kept their full-year views for fiscal 2013 and 2014 close to unchanged. The stock, however, reflects more optimism among investors, with the shares having gained 14% since the beginning of 2013.

Bed Bath & Beyond stands to benefit from the upturn in the housing market that we’ve seen recently. Already, rival Williams-Sonoma , which operates the higher-end Pottery Barn home-furnishings chain, reported extremely strong sales, with its West Elm division showing the strongest results. With Pier 1 also having shown signs of benefiting from the booming market, Bed Bath & Beyond should finally enjoy some macroeconomic tailwinds to support its results.

Many point to home furnishings as an area that’s resistant to online competition, as showrooming for basic household items doesn’t intuitively seem to carry much benefit. But a recent study on showrooming shows that the online threat to Bed Bath & Beyond is very real. The study listed Bed Bath & Beyond as the retailer most at risk of falling prey to Amazon.com . With Amazon’s having developed a smartphone app that lets you immediately see comparable online prices for goods you scan at stores, Bed Bath & Beyond will have to keep prices at least close enough to limit customers’ incentive to wait for an online delivery.

Still, Bed Bath & Beyond has a strong management team that won’t cave in to Amazon without a fight. The acquisition of Cost Plus last year helped bolster its presence in the home-furnishings market, but Bed Bath & Beyond has also recognized …read more

Source: FULL ARTICLE at DailyFinance

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PriceSmart Earnings: An Early Look

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By Dan Caplinger, The Motley Fool

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Spring is finally here, and a new earnings season is right around the corner. Next Tuesday, PriceSmart 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.

PriceSmart isn’t a name you’ll see in the U.S., but the company has taken the warehouse-club model south of the border and turned it into a thriving business throughout Latin America and Caribbean. Can the company keep up its growth pace? Let’s take an early look at what’s been happening with PriceSmart over the past quarter and what we’re likely to see in its quarterly report on Tuesday.

Stats on PriceSmart

Analyst EPS Estimate

$0.77

Change From Year-Ago EPS

15%

Revenue Estimate

$609.7 million

Change From Year-Ago Revenue

10.9%

Earnings Beats in Past 4 Quarters

2

Source: Yahoo! Finance.

Is PriceSmart’s stock a good bargain?
Analysts have had mixed views on PriceSmart recently, reining in their estimates for the most recent quarter by a penny per share but boosting their full-year fiscal 2013 consensus by $0.03 per share. The stock has also had a tepid performance, with share prices up less than 3% since the beginning of 2013.

Given PriceSmart’s business model, investors inevitably make comparisons with U.S. warehouse king Costco and its hugely successful business model of reaping the bulk of its profit from membership fees. Right now, PriceSmart looks a lot like Costco did 25 years ago, with rapidly growing sales but plenty of untapped potential. For PriceSmart, that potential could come from southward expansion into key South American markets such as Brazil, as the company thus far has concentrated on the Caribbean and Central America for most of its stores.

Source: PriceSmart investor relations.

But competition may be coming for PriceSmart. Last month, Wal-Mart got environmental approval for a store in Costa Rica, directly challenging PriceSmart’s home territory.

Still, for now, PriceSmart has kept itself growing at a strong pace. In February, the company reported an 8% increase in sales with a jump in same-store comps of almost 9%. With the announcement of a new club coming to Honduras next year, PriceSmart remains on a steady path to growing its presence throughout the region.

In its earnings report, watch for PriceSmart to discuss its longer-term plans for expansion. With the prospects that Brazil could bring the company, investors won’t want PriceSmart to wait too long before making its move southward.

PriceSmart is smart to follow Costco’s path, as its low prices haven’t just benefited customers — shares have walloped the market, returning 11,000% over the past two decades. However, with …read more

Source: FULL ARTICLE at DailyFinance

Business, Finance, Occupation & Industry

Will Alcoa Get Earnings Season Off on the Right Foot?

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By Dan Caplinger, The Motley Fool

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Spring is finally here, and a new earnings season is right around the corner. Next Monday Alcoa will get us started by releasing 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.

Alcoa has the smallest market cap of any member of the Dow Jones Industrials , but it has the honor of being the first Dow component to report its earnings every quarter. Let’s take an early look at what’s been happening with Alcoa over the past quarter and what we’re likely to see in its quarterly report on Monday.

Stats on Alcoa

Analyst EPS Estimate

$0.10

Change From Year-Ago EPS

0%

Revenue Estimate

$5.93 billion

Change From Year-Ago Revenue

(1.2%)

Earnings Beats in Past 4 Quarters

3

Source: Yahoo! Finance.

Will Alcoa finally start to rebound?
Analysts aren’t too optimistic about Alcoa’s earnings prospects this quarter: They’ve cut their estimates substantially over the past few months, reducing their consensus for the just-ended quarter by $0.03 per share and their full-year 2013 call on EPS by $0.09. The shares have also continued their slow decline, falling by 5% since the beginning of 2013.

In an overall positive environment for the Dow, Alcoa has lagged behind during the past quarter. Given major concerns about the health of the global economy, signs of strength in the U.S. haven’t been enough to pull Alcoa out of its long-term funk.

Alcoa data by YCharts.

But the aluminum giant has hope that conditions will improve eventually because of the strength of some of the sectors that represent its greatest sources of demand. Last quarter CEO Klaus Kleinfeld identified three key industries as potential drivers of growth for Alcoa: automobiles, aircraft, and heavy trucks and trailers. Kleinfeld sees aerospace climbing 9% to 10% in 2013, compared to a 2% to 7% rate for heavy trucks and trailers and a 1% to 4% range for autos globally.

Given enough time, those hopes may pan out. Boeing has been using more aluminum in its jets in order to decrease weight and increase fuel efficiency. Automaker Ford has concentrated some of its biggest high-growth bets on China, and with Alcoa seeing the country as the primary contributor to its growth, Ford’s efforts there will be important to Alcoa’s success.

In Alcoa’s quarterly report, watch closely for the company’s CEO to give his views not only on Alcoa but on the state of the global economy. What he says could set the tone for the entire earnings season.

Once the aluminum market rebounds, Alcoa will be in prime position to take advantage of growth that many expect will lead …read more

Source: FULL ARTICLE at DailyFinance

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Chart: Too Big to Fail Has Failed

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By John Maxfield, The Motley Fool

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The landscape of the banking industry has changed dramatically over the last 30 years. Prior to the 1980s, it was dominated by lenders that were strictly limited by federal and state laws against interstate banking. As the deregulatory fervor of the Reagan era took hold, however, these restrictions were systematically eliminated, igniting the creation of regional banks. The largest of these then began joining forces in the 1990s to create the first truly national banks. After further restrictions were removed in 1999, they began supplementing their traditional banking activities with the trappings of investment banks.

The justification all along has been twofold: First, paid industry lobbyists convinced legislators on both the state and federal level that regulations were unnecessary because bank executives would never behave in a way that would put the now-gargantuan institutions or the economy at risk. It should go without saying that this justification is no longer viable. And second, that greater size offered greater economies of scale, and thus cheaper products for consumers and presumably better returns for investors. It’s the purpose of the following chart to dispel this notion:

Source: Yahoo! Finance.

As you can see, from an investment perspective, the nation’s four largest banks by assets — JPMorgan Chase, Bank of America , Citigroup , and Wells Fargo — have been far from the best performers over the past dozen years. Even the top performer, Wells Fargo, is still far outdone by smaller rivals like People’s United Financial and East West Bancorp . In fact, had you invested your hard-earned money in either Bank of America or Citigroup at the beginning of the year 2000, you’d have 22% and 85% less today, respectively — and that’s excluding the impact of inflation.

Has too big to fail failed? Yes. I don’t think there’s any way to get around that. But does that mean it’s going away? Probably not.

Do you own shares of Bank of America, are or you thinking about buying them?
Bank of America’s stock doubled in 2012. Is there more yet to come? With significant challenges still ahead, it’s critical to have a solid understanding of this megabank before adding it to your portfolio. In The Motley Fool’s premium research report on B of A, analysts Anand Chokkavelu, CFA, and Matt Koppenheffer, Financials bureau chief, lift the veil on the bank’s operations, including detailing three reasons to buy and three reasons to sell. Click here now to claim your copy.

var FoolAnalyticsData = FoolAnalyticsData || []; …read more

Source: FULL ARTICLE at DailyFinance

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WD-40 Earnings: An Early Look

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By Dan Caplinger, The Motley Fool

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The new earnings season is about to begin, but a few companies on off-quarter fiscal years are just now getting around to reporting their quarterly results. WD-40 is about to release its earnings report. The key to making smart investment decisions with stocks releasing their quarterly reports 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.

Most people think of WD-40 as a single-product company, with its namesake solvent being ubiquitous with a place on just about every garage shelf in America. But the company does have a few other products in its arsenal. Let’s take an early look at what’s been happening with WD-40 over the past quarter and what we’re likely to see in its quarterly report on Thursday.

Stats on WD-40

Analyst EPS Estimate

$0.56

Change From Year-Ago EPS

(14%)

Revenue Estimate

$87.4 million

Change From Year-Ago Revenue

1.6%

Earnings Beats in Past 4 Quarters

2

Source: Yahoo! Finance.

Will WD-40 get the job done this quarter?
Analysts have had mixed views on WD-40 recently, cutting back on earnings estimates for the just-ended quarter but boosting their full-year fiscal 2013 calls by $0.03 per share. The stock has done quite well lately, though, rising almost 14% since the beginning of the year.

WD-40 reaps the benefits of having its small niche largely to itself. But beyond its namesake product, it also makes Lava soap and 2000 Flushes bathroom cleanser, putting itself up against much larger consumer-oriented giants like Unilever‘s Dove soap line and Procter & Gamble‘s numerous cleaning products.

What may be surprising is the extent to which WD-40 has followed in Unilever and P&G’s steps by looking to overseas markets for growth opportunities. Unfortunately, WD-40 has a much larger presence in Europe than in Asia, and given Europe‘s struggles, the company could face tougher times ahead until the economy there manages to rebound. That’s consistent with Procter & Gamble’s challenges overseas, although Unilever has done a good job taking advantage of P&G’s miscues to tap into global growth prospects.

Still, WD-40 is never going to reach a scale even approaching its consumer-giant rivals. Rather, it has pigeonholed itself fairly well into what has been a successful niche for the company, albeit with only modest prospects for future growth.

In its quarterly report, watch for WD-40 to give details on how its $50 million share buyback program is going. With the company sporting impressive cash flow that has financed rising dividends lately, investors in WD-40 aren’t looking for a quick score. Rather, as long as long-term prospects remain favorable, a small decline in year-over-year earnings shouldn’t cause any huge disruptions unless it comes with future …read more
Source: FULL ARTICLE at DailyFinance

Business, Finance, Occupation & Industry

Greenbrier Earnings: An Early Look

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By Dan Caplinger, The Motley Fool

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The new earnings season is about to begin, but a few companies on off-quarter fiscal years are just now getting around to reporting their quarterly results. Greenbrier is about to release its quarterly earnings report. The key to making smart investment decisions with stocks releasing their quarterly reports 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.

Railroads have enjoyed a renaissance in recent years, as high fuel costs have made trains a more energy-efficient way to transport goods. Greenbrier doesn’t run a railroad, but it provides the train-cars and other equipment that railroads need in order to operate. Let’s take an early look at what’s been happening with Greenbrier over the past quarter and what we’re likely to see in its quarterly report on Thursday.

Stats on Greenbrier

Analyst EPS Estimate

$0.37

Change From Year-Ago EPS

(35%)

Revenue Estimate

$442.9 million

Change From Year-Ago Revenue

(3.3%)

Earnings Beats in Past 4 Quarters

3

Source: Yahoo! Finance.

Will Greenbrier run off the rails this quarter?
Analysts have had mixed thoughts about Greenbrier’s earnings prospects in recent months. They reduced their calls for the quarter that ended in February by $0.03 per share, but they upped their full-year fiscal 2013 estimates by the same amount. The stock, meanwhile, has soared, rising nearly 40% just since the beginning of the year.

The big drama for Greenbrier during the last quarter has come from rival American Railcar‘s buyout bid for the company. With activist investor Carl Icahn involved in both companies, American Railcar‘s bid of $20 per share back in December sent Greenbrier shares soaring, and now, Greenbrier’s stock trades well above that figure. Greenbrier CEO William Furman said that he’s open to discussions about consolidation, but so far, no deal has been accepted.

But just last week, Greenbrier gave investors a taste of how much business activity it has seen recently. The company reported that it had gotten orders for 5,400 railcars with a total value of about $575 million. Nearly half of those orders were for tank cars, showing the importance of the energy industry to Greenbrier’s sales. Burlington Northern and Canadian National Railway have both taken advantage of transportation bottlenecks to key energy-producing areas to offer rail-based transport, and Greenbrier stands to benefit from the demand.

The big question is whether pipeline development will end oil and gas producers’ flirtations with rail. Greenbrier thinks producers will stick with rail regardless, and Phillips 66‘s deal to bring Bakken crude by rail to a New Jersey refinery is just the latest in extensive activity to move energy products.

In its quarterly report, watch for updates on the company’s strategic plans, …read more
Source: FULL ARTICLE at DailyFinance

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RPM International Earnings: An Early Look

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By Dan Caplinger, The Motley Fool

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The new earnings season is about to begin, but a few companies on off-quarter fiscal years are just now getting around to reporting their quarterly results. RPM International is about to release its quarterly earnings report. The key to making smart investment decisions with stocks releasing their quarterly reports 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.

Companies that stand to benefit from a rising housing market have been increasingly popular lately, and RPM‘s extensive lineup of waterproofing and weatherproofing products for everything from driveways and wood decks to roofing sealants and caulk definitely qualifies it as a play on home ownership. Let’s take an early look at what’s been happening with RPM International over the past quarter and what we’re likely to see in its quarterly report on Thursday.

Stats on RPM International

Analyst EPS Estimate

$0.06

Change From Year-Ago EPS

20%

Revenue Estimate

$841.4 million

Change From Year-Ago Revenue

8.8%

Earnings Beats in Past 4 Quarters

2

Source: Yahoo! Finance.

Will RPM International be loss-proof this quarter?
Analysts have gotten a little less optimistic about RPM‘s prospects in recent months, as they’ve reduced their earnings-per-share calls by a penny for the most recent quarter and by $0.03 for the full 2013 fiscal year. The stock has posted a modest advance of about 6% so far this year, but that’s well below the overall market‘s performance, let alone that of some high-flying housing-related stocks.

RPM has benefited greatly from better prospects in the housing industry. As results from the homebuilding sector have gotten stronger, demand for RPM’s sealants and coatings has followed suit, sending share price higher. In addition to providing consumer products like Rust-O-Leum and DAP, the company also provides a wide variety of materials for industrial companies and commercial builders. The industrial segment makes up two-thirds of RPM‘s overall business.

But RPM has plenty of competition to deal with. Both Sherwin-Williams and PPG Industries dwarf RPM in size, although both of those companies are much more focused on the paint sector, which has its own specific industry dynamics. Nevertheless, just as PPG and Sherwin-Williams have had to deal with the ups and downs of the titanium dioxide market — a key pigment for paint production — RPM also mentions it as a key driver of its raw-materials costs, in addition to certain resins and solvents related to other products.

In its quarterly report, watch for RPM to discuss why its revenue growth has lagged behind that of PPG and Sherwin-Williams over the past year. Without a satisfactory explanation, it’ll be hard to justify paying 25 times trailing earnings for the stock, even with a …read more
Source: FULL ARTICLE at DailyFinance

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International Speedway Earnings: An Early Look

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By Dan Caplinger, The Motley Fool

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The new earnings season is about to begin, but a few companies on off-quarter fiscal years are just now getting around to reporting their quarterly results. International Speedway is about to release its quarterly earnings report. The key to making smart investment decisions with stocks releasing their quarterly reports 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.

Auto racing used to be a niche sport, but with the huge rise in interest in Nascar and other events, racing has entered the mainstream. International Speedway is one of the companies behind the scenes, maintaining many of the most popular racetracks and grandstands on the racing circuit, including its crown jewel, the Daytona International Speedway. Let’s take an early look at what’s been happening with International Speedway over the past quarter and what we’re likely to see in its quarterly report on Thursday.

Stats on International Speedway

Analyst EPS Estimate

$0.36

Change From Year-Ago EPS

(2.7%)

Revenue Estimate

$126.5 million

Change From Year-Ago Revenue

(0.7%)

Earnings Beats in Past 4 Quarters

2

Source: Yahoo! Finance.

Will International Speedway win the checkered flag done this quarter?
Analysts haven’t been too bullish on International Speedway‘s earnings prospects in recent months, as they’ve cut more than a nickel per share off its most-recent quarter’s estimates and lopped nearly $0.20 per share from their full-year fiscal 2013 views. But the stock has raced ahead, climbing nearly 20% since the beginning of the year.

Racing has never been more popular, and International Speedway has the inside track to tap the sport’s profit potential. Danica Patrick‘s qualifying for the pole position in February’s Daytona 500 opened up the doors to a whole new group of young fans that could give the sport its next phase of expansion.

But an incident at Daytona on the day before the Daytona 500 in February highlighted the potential liability that International Speedway has. At the Nationwide series race, a car crashed into the outer track fence in a multi-car accident, and pieces of debris from the car entered the stands and caused injuries. Despite having liability waivers on tickets, lawyers involved in the case expect an out-of-court settlement to cover the roughly 30 fans who were injured.

From a bigger-picture perspective, International Speedway faces the same economic woes that have hurt other entertainment companies. Rival Speedway Motorsports , which operates tracks at Bristol and other popular venues, has seen similarly flat revenue recently. In order to compete for a bigger piece of a pie that hasn’t been growing much, International Speedway entered into a deal with Coinstar to provide tickets at Coinstar’s movie kiosks.

In its quarterly report, watch for International Speedway to …read more
Source: FULL ARTICLE at DailyFinance

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McCormick Earnings: An Early Look

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By Dan Caplinger, The Motley Fool

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The new earnings season is about to begin, but a few laggards are still getting around to reporting their quarterly results. McCormick is about to release its quarterly earnings report. The key to making smart investment decisions with stocks releasing their quarterly reports 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.

McCormick has turned the spice niche into its own personal profit-making machine. But can the company continue to combine the broad-based appeal of its consumer spice operations with its lucrative deals with commercial food preparers? Let’s take an early look at what’s been happening with McCormick over the past quarter and what we’re likely to see in its quarterly report on Tuesday.

Stats on McCormick

 

  

Analyst EPS Estimate

$0.56

Change From Year-Ago EPS

1.8%

Revenue Estimate

$922.7 million

Change From Year-Ago Revenue

1.8%

Earnings Beats in Past 4 Quarters

2

Source: Yahoo! Finance.

Will McCormick spice up its report this quarter?
Analysts haven’t been all that impressed with McCormick’s earnings prospects in the past few months, as they’ve cut back on their estimates for the most recent quarter by $0.08 per share as part of a broader fiscal 2013 pullback of $0.15 per share. The stock, however, didn’t miss a beat, rising more than 15% during the first three months of 2013.

McCormick stands atop the spice industry with its impressive dominance of the U.S. consumer market. The company has used that position to deliver strong returns and steadily rising dividends to investors, with average annual returns of more than 15% over the past 30 years.

But McCormick hasn’t been coasting on its success. It has made acquisitions to expand internationally, with an emphasis on growing emerging market sales to make up a fifth of its overall revenue within the next few years. The company has also been introducing new products, having launched 250 new products just last year alone.

One interesting area for expansion in McCormick’s product line comes from its Zatarain’s brand of boxed rice dishes. Unlike most of its segments, Zatarain’s has strong competition in main rival PepsiCo‘s Rice-a-Roni. But if McCormick can emphasize the spice in its packaged products compared to Rice-a-Roni and other competing products like General Mills and its Hamburger Helper line of accompaniments, then it could manage to succeed in a cutthroat packaged-foods industry.

In its quarterly report, watch closely for McCormick’s discussion of profit margins. With food input prices still at elevated levels, understanding better how McCormick is affected by those prices is valuable for assessing the investment in the future. At a lofty 24 times earnings, McCormick isn’t a stock you need to jump on right away.

Many people forget about PepsiCo’s food business, …read more
Source: FULL ARTICLE at DailyFinance

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Global Payments Earnings: An Early Look

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By Dan Caplinger, The Motley Fool

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The new earnings season is about to begin, but a few laggards are still getting around to reporting their quarterly results. Global Payments is about to release its quarterly earnings report. The key to making smart investment decisions with stocks releasing their quarterly reports 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 move in light of the news.

The way people pay each other has changed dramatically in just the past few years, and Global Payments is on the cutting edge of trying to transform the electronic-payments industry in an era of smartphones and other mobile devices. Let’s take an early look at what’s been happening with Global Payments over the past quarter and what we’re likely to see in its quarterly report on Tuesday.

Stats on Global Payments

Analyst EPS Estimate

$0.89

Change From Year-Ago EPS

7.2%

Revenue Estimate

$580.3 million

Change From Year-Ago Revenue

8.8%

Earnings Beats in Past 4 Quarters

2

Source: Yahoo! Finance.

Will Global Payments pay off for investors this quarter?
Analysts have been more optimistic in recent months about the earnings prospects for Global Payments, as they’ve boosted their consensus for the just-ended quarter by a penny per share and now see full fiscal-year 2013 earnings coming in $0.06 per share higher than they did. The stock has also done well recently, rising almost 10% in the first three months of 2013.

Global Payments is a big player in the merchant-processing area. Acting as a go-between for merchants to accept payments from customers using popular credit card networks, Global Payments has profited from the big upsurge in use of credit and debit cards over other forms of payment.

But this time last year, Global Payments faced a threat to its survival when a security breach jeopardized 1.5 million cardholders. Card network giants Visa and MasterCard both booted the company off their lists of payment processors meeting their security standards, putting Global Payments‘ future in doubt.

More importantly, competitors are looking to cut Global Payments and other middlemen out of the business. Mobile-payment upstart Square has joined eBay‘s highly successful PayPal in offering simple acceptance of credit cards at low costs. That may not pull high-volume merchants away from Global Payments, but as Square announced a partnership with Starbucks last year, it’s entirely possible that traditional merchant processors could disappear in time.

In its quarterly report, watch for Global Payments to benefit from reasonably strong payment-volume growth in the overall economy. If it doesn’t, it could be a troubling sign that Global Payments isn’t maintaining its market share in the payment processing industry, and that in turn could be a sign of further trouble to come. 

The …read more
Source: FULL ARTICLE at DailyFinance

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OMNOVA Solutions Earnings: An Early Look

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By Dan Caplinger, The Motley Fool

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The new earnings season is about to begin, but a few companies on off-quarter fiscal years are just now getting around to reporting their quarterly results. OMNOVA Solutions is about to release its quarterly earnings report. The key to making smart investment decisions with stocks releasing their quarterly reports 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.

OMNOVA is a maker of specialty chemicals, and with products running from laminates and other materials for residential construction purposes to performance-based chemical products for a wide range of industries that includes the oil and gas sector, the company is hoping to take advantage of improving conditions in those industries. Let’s take an early look at what’s been happening with OMNOVA Solutions over the past quarter and what we’re likely to see in its quarterly report on Wednesday.

Stats on OMNOVA Solutions

Analyst EPS Estimate

$0.08

Change From Year-Ago EPS

(64%)

Revenue Estimate

$258.3 million

Change From Year-Ago Revenue

(6.4%)

Earnings Beats in Past 4 Quarters

2

Source: Yahoo! Finance.

Will OMNOVA Solutions finally beat estimates this quarter?
Analysts have cut their views on OMNOVA substantially in recent months, slashing their earnings-per-share consensus for the most recent quarter by more than half and chopping $0.13 per share from their full-year fiscal 2013 calls. The stock hasn’t reacted badly, however, rising nearly 10% during the first three months of 2013.

OMNOVA hasn’t had a lot of luck lately in converting on its massive opportunities. Last quarter, the company missed estimates by a large margin as it cited poor demand from Europe and in the products it makes for the paper industry. Although CEO Kevin McMullen said things would improve, he believed that it could take until the fiscal second quarter before those improvements really started to take hold.

But OMNOVA has plenty of potential to take off from here. On one hand, the housing industry has finally started to recover more strongly, and OMNOVA‘s major customers in the space have benefited. Sherwin-Williams , which gets specialty chemicals from OMNOVA, has soared as demand for its paint products rises in an improving market, and similar news from other customers should help OMNOVA as well.

On the other hand, the energy industry also has a lot of growth potential. Oil-services companies Schlumberger and Halliburton both have seen a lot of demand in recent years, with Schlumberger dominating the entire global industry while Halliburton has a strong domestic presence. Although weak natural-gas prices have held back those services providers, OMNOVA should benefit when prices get closer to normal.

In its quarterly report, OMNOVA‘s first-quarter numbers won’t be nearly as important as its future guidance. If …read more
Source: FULL ARTICLE at DailyFinance

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Monsanto Earnings: An Early Look

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By Dan Caplinger, The Motley Fool

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The new earnings season is about to begin, but a few companies on off-quarter fiscal years are just now getting around to reporting their quarterly results. Monsanto is about to release its quarterly earnings report. The key to making smart investment decisions with stocks releasing their quarterly reports 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.

Monsanto has cashed in on the success of the agricultural industry in recent years, with its seeds and fertilizer business both contributing to rising yields and farm productivity. Let’s take an early look at what’s been happening with Monsanto over the past quarter and what we’re likely to see in its quarterly report on Wednesday.

Stats on Monsanto

Analyst EPS Estimate

$2.58

Change From Year-Ago EPS

13%

Revenue Estimate

$5.27 billion

Change From Year-Ago Revenue

11%

Earnings Beats in Past 4 Quarters

3

Source: Yahoo! Finance.

Will Monsanto help its stock grow this quarter?
Analysts have had mixed views on Monsanto’s earnings prospects in recent months, as they’ve cut their consensus on its most recent quarter by a penny per share but boosted their full-year fiscal 2013 earnings call by $0.14 per share. The stock hasn’t had any trouble growing, though, with a 12% gain in the first three months of 2013.

Monsanto is just one of many agricultural companies that have taken advantage of extremely favorable conditions to boost profits. Peers Terra Nitrogen and CVR Partners have seen substantial earnings growth as low input costs for their nitrogen-based fertilizers have helped keep margins extraordinarily wide. Yet fertilizer is fundamentally nothing but a commodity, providing no barrier to entry and no protection against changing conditions in the farm economy.

Monsanto, on the other hand, has its seed technology as a proprietary asset that distinguishes the company from its competitors. Genetically modified seeds have raised plenty of controversy around the world, but they’ve also proven to be valuable, especially with drought-resistant strains having been able to weather the harsh conditions in the Farm Belt last summer. The battle will likely continue, as Whole Foods has required suppliers to disclose whether foods contain genetically modified organisms.

The best news for Monsanto came just days ago, as the company settled a lawsuit with DuPont over a dispute over technology behind engineered seeds. Under the deal, DuPont will make royalty payments of at least $1.75 billion over the next 10 years and allow Monsanto to have access to DuPont patents covering disease-resistance and corn-defoliation traits. DuPont in turn will be allowed to offer Monsanto’s soybean technology, but the big win for Monsanto is the end of legal battles that have distracted both companies …read more
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Acuity Brands Earnings: An Early Look

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By Dan Caplinger, The Motley Fool

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The new earnings season is about to begin, but a few companies on off-quarter fiscal years are just now getting around to reporting their quarterly results. Acuity Brands is about to release its quarterly earnings report. The key to making smart investment decisions with stocks releasing their quarterly reports 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.

Lighting may not sound like the most interesting business, but Acuity Brands has turned providing cutting-edge lights for both commercial and consumer uses into a solidly profitable enterprise. Let’s take an early look at what’s been happening with Acuity Brands over the past quarter and what we’re likely to see in its quarterly report on Wednesday.

Stats on Acuity Brands

Analyst EPS Estimate

$0.62

Change From Year-Ago EPS

8.8%

Revenue Estimate

$468.5 million

Change From Year-Ago Revenue

2.4%

Earnings Beats in Past 4 Quarters

1

Source: Yahoo! Finance.

Will Acuity Brands see the light this quarter?
Analysts have been increasingly concerned about Acuity’s earnings prospects in recent months, having cut their earnings-per-share calls on the most recent quarter by $0.08 and chopping more than $0.27 per share off their consensus for the full 2013 fiscal year. The shares have reflected those concerns, as they rose less than 3% during the first three months of 2013 despite a strong overall market.

Acuity is a lighting specialist that has a wide range of products that include light-emitting diode technology. LEDs have been a hotbed of investor interest lately because of their application to the display industry. Cree‘s LED business encompasses not just pure lighting but also video screens for computers and mobile devices, which have seen huge growth lately. Universal Display has gone a step beyond conventional LEDs, turning to organic LED technology as a potential source of efficiency gains and finally starting to ramp up production.

But even as Universal Display, Cree, and a host of other players fight over various parts of the consumer and tech markets, Acuity goes beyond those applications to pull in other lighting needs as well. With lighting systems and controls that serve commercial needs as well as daylighting systems that utilize and enhance the effectiveness of available natural light, Acuity seeks to cover all its bases in the industry. That can cause problems in some economic environments, as Acuity’s commercial business has been more sensitive to prevailing economic conditions, especially in parts of Europe.

In its quarterly report, watch for Acuity to discuss its recent buyout of Dutch LED-driver manufacturer eldoLED. The move should enhance Acuity’s ability to deliver new innovations in solid-state lighting and bolster its leadership in the indoor/outdoor lighting space.

Acuity relies …read more
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Winnebago Earnings: An Early Look

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By Dan Caplinger, The Motley Fool

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Earnings season is just about over, with almost all companies already having reported their quarterly results. But there are still a few companies left to report, and Winnebago is about to release its quarterly earnings report. The key to making smart investment decisions with stocks that are releasing their quarterly reports 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.

Winnebago may not make the fastest vehicles on the planet, but its stock has been a speedster lately. What’s behind the company’s stratospheric rise? Let’s take an early look at what’s been happening with Winnebago over the past quarter, and what we’re likely to see in its quarterly report on Thursday.

Stats on Winnebago

 

  

Analyst EPS Estimate

$0.15

Year-Ago EPS

($0.03)

Revenue Estimate

$170.9 million

Change From Year-Ago Revenue

30%

Earnings Beats in Past 4 Quarters

2

Source: Yahoo! Finance.

Will Winnebago race ahead this quarter?
Analysts have gotten really optimistic on Winnebago recently. They’ve upped their estimates on earnings for the most-recent quarter by nearly $0.10 per share over the past few months, and they’ve lifted their full-year fiscal 2013 calls by more than $0.30 per share. The stock has jumped by more than 30% just since late December, after a spectacular 2012 that saw share prices double.

Winnebago was almost a casualty of the 2008 recession. As potential customers saw their savings disappear in the market meltdown, recreational vehicles were the first discretionary-spending item they marked off their list, and many of Winnebago’s peers ended up filing for bankruptcy.

Yet, Winnebago managed to survive. Because of Winnebago’s vertically integrated business, which includes its own production facilities, the company is able to respond more quickly to changes in consumer demand. Moreover, its customer service gives Winnebago a vital competitive advantage over rival Thor Industries and its Airstream brand of RVs, because customers know that Winnebago will be around to honor warranties and deal with issues.

Moreover, as baby boomers begin to enter retirement, Winnebago should see a natural demographic upturn in sales. Motorcycle-maker Harley Davidson has shown similar promise lately, with growth in its target upper-middle-age customer demographic pointing toward higher revenue, and the stock has risen near multi-year highs as a result. Similarly, Winnebago has regained much of the ground it lost during the financial crisis, and appears poised to continue its winning ways.

In its quarterly report, watch for Winnebago to discuss the impact of stubbornly high fuel prices on its sales. Given how well Winnebago has done, even in the face of high prices at the pump throughout the past year, it seems likely that the RV company will be able to overcome that obstacle once again.

The best investing …read more
Source: FULL ARTICLE at DailyFinance

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Finish Line Earnings: An Early Look

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By Dan Caplinger, The Motley Fool

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Earnings season is just about over, with almost all companies already having reported their quarterly results. But there are still a few companies left to report, and Finish Line is about to release its quarterly earnings. The key to making smart investment decisions with stocks releasing their quarterly reports 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.

Finish Line isn’t the biggest player in the athletic shoe and apparel industry, but it nevertheless has sought to take advantage of the big growth in the area over the past several years. Let’s take an early look at what’s been happening with Finish Line over the past quarter and what we’re likely to see in its quarterly report on Thursday.

Stats on Finish Line

Analyst EPS Estimate

$0.75

Change From Year-Ago EPS

(7.4%)

Revenue Estimate

$452.3 million

Change From Year-Ago Revenue

(0.9%)

Earnings Beats in Past 4 Quarters

2

Source: Yahoo! Finance.

Will Finish Line finish strong this quarter?
Analysts have cut their views on Finish Line over the past few months, slicing $0.08 per share off their earnings estimates for the most-recent quarter and $0.26 per share on their full-year fiscal 2014 calls. The stock has similarly languished, falling about 3% since late December despite the stock market‘s overall strength.

The demand for athletic apparel has risen sharply in recent years, as new players among apparel- and shoemakers have forced established giants to up their game. Nike continues to dominate the athletic footwear industry, but Under Armour has challenged the company on the apparel side of the business and more recently has gone heads-up against Nike with its own shoes. That buzz has helped increase awareness of athletic specialty products generally.

But the big problem is that the most successful brands have made moves to distribute their goods through their own stores rather than via independent specialty retailers. Both Nike and Under Armour distribute through third parties, but both companies have networks of factory outlets and specialty stores that allow them to keep more of their profits. Although rival Foot Locker has done a fairly good job of keeping its stock moving higher over the long run, in part because of its emphasis on highly popular basketball shoes, Finish Line has struggled under the threat of competition and sluggishness in running-shoe demand.

In response, Finish Line has been working with Macy’s to create a store-within-a-store concept. But some analysts are skeptical about whether the move will do more harm than good as it saps Finish Line‘s status as an independent retailer.

In its quarterly report, watch for Finish Line to address how it intends to integrate its …read more
Source: FULL ARTICLE at DailyFinance

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Accenture Earnings: An Early Look

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By Dan Caplinger, The Motley Fool

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Earnings season is just about over, with almost all companies already having reported their quarterly results. But there are still a few companies left to report, and Accenture is about to release its quarterly earnings report. The key to making smart investment decisions with stocks releasing their quarter reports 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

Accenture emerged from the Arthur Andersen scandal relatively unscathed and has remained a giant in the consulting industry. But given the massive rush toward high-margin consulting services in a number of key sectors, especially technology, Accenture faces more competition than ever before. Let’s take an early look at what’s been happening with Accenture over the past quarter and what we’re likely to see in its quarterly report on Thursday.

Stats on Accenture

Analyst EPS Estimate

$0.97

Change From Year-Ago EPS

0%

Revenue Estimate

$7.07 billion

Change From Year-Ago Revenue

4%

Earnings Beats in Past 4 Quarters

3

Source: Yahoo! Finance.

Will Accenture accentuate the positive this quarter?
Analysts have barely budged on their views on Accenture in recent months, keeping their estimates on the just-completed quarter stable while trimming $0.02 per share off their full-year fiscal 2013 calls. The stock has done reasonably well lately, though, rising about 10% since late December.

Accenture is a predominant firm in the global consultancy industry. Its strong reputation for highly driven employees and a competitive spirit have helped it survive and adapt to vastly changing economic conditions in the industry over the years. The company has also done a good job of sharing its returns with shareholders while still keeping employees motivated and working hard.

A big reason for Accenture’s success has been its ability to identify promising opportunities. Ever since India started emerging as a growing economic power, Accenture has turned to India to take advantage of its profit-making potential, with 70,000 employees in the emerging nation covering a wide variety of sectors. Moreover, the fast-growing energy industry has also benefited Accenture, as energy companies and investors turn to the consulting giant for data and expertise on all facets of the industry.

But recently, Accenture has had to deal with a huge number of competitors realizing the value in providing high-margin, low-cost services. Especially in technology, IBM and Cisco Systems have worked hard to go beyond their relatively low-margin commodity-like hardware businesses to capture a bigger share of the IT consulting market, squeezing Accenture’s early-mover advantage in the space. Moreover, General Electric has aimed squarely at the energy industry, with its expertise in nuclear, solar, wind, and other forms of energy production and infrastructure becoming an increasingly important part …read more
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Commercial Metals Earnings: An Early Look

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By Dan Caplinger, The Motley Fool

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Earnings season is just about over, with almost all companies already having reported their quarterly results. But there are still a few companies left to report, and Commercial Metals is about to release its quarterly earnings report. The key to making smart investment decisions with stocks releasing their quarter reports 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.

Commercial Metals is in the middle of a tough industry, with its emphasis on steel and metal products. But the company’s unique angle gives it a big advantage over most of its peers. Let’s take an early look at what’s been happening with Commercial Metals over the past quarter and what we’re likely to see in its quarterly report on Thursday.

Stats on Commercial Metals

Analyst EPS Estimate

$0.18

Change From Year-Ago EPS

(25%)

Revenue Estimate

$1.86 billion

Change From Year-Ago Revenue

(4.9%)

Earnings Beats in Past 4 Quarters

2

Source: Yahoo! Finance.

Will Commercial Metals cash in this quarter?
Analysts have given a mixed picture of earnings prospects for Commercial Metals over the past few months, reducing their calls for the most recent quarter by a nickel per share but raising full-year fiscal 2013 estimates by $0.03 per share. The stock has taken the more bullish view, rising about 10% since late December.

The steel industry has been a tough place to make money lately, both for companies that make steel and those that provide raw materials for steel production. Iron ore and metallurgical coal producer Cliffs Natural Resources has been one of the hardest-hit stocks of 2013, losing nearly half its value after slashing its dividend by more than 75% due to low prices and negative prospects. Similarly, steel produce U.S. Steel has had to navigate weak end-markets that are suffering from worldwide slowdowns in construction activity and questionable economic futures for the countries that have until now had the heaviest demand for steel.

But Commercial Metals has a different approach. In addition to maintaining its own mills, Commercial Metals also collects and processes scrap metal for use by its customers in making new metal products. That’s not a guaranteed money-making strategy, but because the prices it pays for scrap tend to track what it can receives in revenue, Commercial Metals has been more consistently profitable than traditional producers.

Commercial Metals faces a big challenge because of its substantial debt. Without plentiful free cash flow to maintain that debt, Commercial Metals has to hope that a recovery in its end-markets will boost its prospects.

In its quarterly report, watch for Commercial Metals to discuss the trends among its steel-producing customers. Many investors are pointing to the housing …read more
Source: FULL ARTICLE at DailyFinance

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Lindsay Earnings: An Early Look

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By Dan Caplinger, The Motley Fool

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Earnings season is just about over, with almost all companies already having reported their quarterly results. But there are still a few companies left to report, and Lindsay is about to release its quarterly earnings report. The key to making smart investment decisions with stocks releasing their quarter reports 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.

Lindsay makes irrigation systems for agricultural use, and given last summer’s drought, the company’s products have moved into the limelight in a big way lately. Can the Omaha-based company take advantage of the opportunity it has to grow? Let’s take an early look at what’s been happening with Lindsay over the past quarter and what we’re likely to see in its quarterly report on Wednesday.

Stats on Lindsay

Analyst EPS Estimate

$1.30

Change From Year-Ago EPS

30%

Revenue Estimate

$163.3 million

Change From Year-Ago Revenue

24%

Earnings Beats in Past 4 Quarters

3

Source: Yahoo! Finance.

Will Lindsay make its earnings grow this quarter?
Analysts have upgraded their estimates on Lindsay substantially in recent months, boosting their calls for the most-recent quarter by $0.18 per share and pushing up full-year fiscal 2013 earnings-per-share estimates by $0.67, or more than 15%. The company’s stock has responded in kind, rising more than 20% since mid-December.

Lindsay’s business may sound simple, but its equipment is both innovative and essential for farmers, especially in drier areas. With its quarter-mile-radius apparatus and pinpoint-precision water application methods, Lindsay is able to get 90% of available water into the soil, versus just 50% for flood irrigation and other more traditional methods.

During last year’s drought, Lindsay came into its own. In its previous quarterly report, Lindsay said that overall sales of irrigation equipment jumped by a third, with a nearly 60% rise in domestic sales. Moreover, it projected that the trend would continue as more farmers seek to avoid the problems that last year’s dry spell caused. Even with Valmont Industries also seeing similar gains in demand for irrigation equipment, it appears that there’s more than enough demand for both companies to benefit, and Lindsay arguably has an advantage from its greater focus on irrigation equipment than Valmont and its more diversified business.

The big threat to Lindsay is one it shares with most ag-related companies: falling crop prices. Just last week, Deere got downgraded by an analyst who argued that future drops in the price of corn would reduce demand for its agricultural equipment. Yet although calls for crop prices to drop will eventually be correct, they’ve largely been wrong for years now, and the industry has continued to flourish.

In its quarterly report, watch closely for …read more
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Texas Industries Earnings: An Early Look

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By Dan Caplinger, The Motley Fool

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Earnings season is just about over, with almost all companies already having reported their quarterly results. But there are still a few companies left to report, and Texas Industries is about to release its quarterly earnings report. The key to making smart investment decisions with stocks releasing their quarter reports 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.

For years, the construction industry languished in a slow economic recovery, and Texas Industries had difficulty in its cement and construction-aggregates business. But over the past year, the recovery has finally taken hold in full force, and companies across the industry have taken flight. Let’s take an early look at what’s been happening with Texas Industries over the past quarter and what we’re likely to see in its quarterly report on Wednesday.

Stats on Texas Industries

Analyst EPS Estimate

($0.41)

Year-Ago EPS

($0.87)

Revenue Estimate

$141 million

Change From Year-Ago Revenue

4.7%

Earnings Beats in Past 4 Quarters

1

Source: Yahoo! Finance.

Will Texas Industries build up its stock price this quarter?
In recent months, analysts have gotten less pessimistic about prospects for Texas Industries. They’ve narrowed their loss estimates for the just-ended quarter by more than a dime per share, and they’ve been even more enthusiastic about the company’s fiscal 2014 results, as they’re now coming a lot closer to seeing Texas Industries break even. The stock has been on fire, rising nearly 30% just since mid-December.

Throughout the construction business, hope about the recent upturn in housing construction has led to renewed interest in Texas Industries and its peers. Late last year, Martin Marietta Materials started seeing a big upsurge in revenue as new-home starts and permits for new residential construction jumped to multiyear highs, and activity levels have only increased since then. By itself, housing won’t boost demand enough to justify big share-price moves, but historically, non-residential construction has followed on the heels of new home-building, and Vulcan Materials and Texas Industries have both seen investors anticipate an expected upturn across the non-residential industry.

But Texas Industries still faces some challenges. Unlike Martin Marietta, Texas Industries hasn’t managed to become consistently profitable. Until expected increases in orders actually materialize, it’s hard to take the company’s share-price advance as anything but premature.

Still, at least one insider is excited about Texas Industries. Bernard Lanigan, who serves on the company’s board of directors, has regularly bought shares over the past six months, most recently investing more than $500,000 in early February.

In its quarterly report, watch Texas Industries closely to see if it’s able to avoid the revenue drop in aggregates that Vulcan suffered during its most recent quarter. Guidance …read more
Source: FULL ARTICLE at DailyFinance

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Steelcase Earnings: An Early Look

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By Dan Caplinger, The Motley Fool

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Earnings season is just about over, with almost all companies already having reported their quarterly results. But there are still a few companies left to report, and Steelcase is about to release its quarterly earnings. The key to making smart investment decisions with stocks releasing their quarterly reports 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.

Steelcase makes furniture and other architectural products primarily for business use, as well as electronic whiteboards and other communication-related products for educational, business, and government customers. Yet as businesses have implemented cost-cutting measures, many have had to reduce their spending on non-essential items. Let’s take an early look at what’s been happening with Steelcase over the past quarter and what we’re likely to see in its quarterly report on Wednesday.

Stats on Steelcase

Analyst EPS Estimate

$0.19

Change From Year-Ago EPS

36%

Revenue Estimate

$709.5 million

Change From Year-Ago Revenue

2.8%

Earnings Beats in Past 4 Quarters

1

Source: Yahoo! Finance.

Will Steelcase make investors feel comfortable this quarter?
Analysts have been rock-solid in their calls on Steelcase’s earnings lately, having not budged on both most-recent quarter and full-year fiscal 2014 estimates throughout the past several months. The stock, though, has moved favorably, rising nearly 20% since mid-December.

Despite tough economic environment, Steelcase has done a good job of identifying a niche that has been able to keep growing. By targeting large corporate customers with high-end office furniture, Steelcase has drilled down with an active focus on providing what its clients see as necessities while still maintaining its overall profitability.

Still, Steelcase faces strong competition. Cubicle-maker Herman Miller managed to beat earnings estimates in its own quarterly report late last week, sending its shares soaring more than 7%. Herman Miller sports better margins and return-on-equity than Steelcase, although Steelcase has a more secure balance sheet with a lower debt-to-equity ratio than its rival. HNI , on the other hand, missed its earnings estimates back in February.

Overall, though, stock prices throughout the industry have been doing well. As the economy recovers more quickly, especially in the housing industry, furniture companies have seen sales rise. Although office furniture isn’t necessarily correlated to housing, investors seem to put Steelcase and its peers in the same category.

In its quarterly report, watch for Steelcase to discuss its Gesture line of chairs, which addresses the results of a recent study it did to see how mobile devices change sitting postures. With business customers seeking to decrease workers’ compensation claims, they’re often willing to pay up for the latest technology, and if Steelcase can make its case for the need for new furniture to accommodate tablets and smartphones, it …read more
Source: FULL ARTICLE at DailyFinance