Last week's preview raised the question of whether consumers were turning to comfort foods in these uncertain times, specifically in terms of second quarter earnings of Campbell Soup (NYSE: CPB) and Krispy Kreme (NYSE: KKD). Campbell's strong earnings growth topped expectations, while Krispy Kreme narrowed its loss, though it fell short of estimates.
This coming week should bring reports from more food-related companies, from cereal maker General Mills and food packager CongAgra to grocery chain Kroger, to the parent companies of restaurants Cracker Barrel, Olive Garden, Red Lobster, Carl's Jr., and Hardees. Also look for reports from tech-related companies such as Oracle, Adobe, and Palm, as well as from financials Morgan Stanley and Goldman Sachs, and from economic bellwether FedEx.
Here's what analysts surveyed by Thomson Financial are expecting from some of the companies reporting earnings this week, as compared to their results from the same period of last year:
- Schiff Nutrition International Inc. (NYSE: WNI): $0.09 per share (+33.3%) on revenue of $45.2 million (+10.9%)
- Pall Corp. (NYSE: PLL): $0.60 per share (+23.3%) on revenue of $710.4 million (+9.9%)
- Brady Corp. (NYSE: BRC): $0.62 per share (+22.6%) on revenue of $385.7 million (+6.3%)
- AAR Corp. (NYSE: AIR): $0.45 per share (+20.0%) on revenue of $362.2 million (+18.4%)
- Marcus Corp. (NYSE: MCS): $0.47 (+19.1%) on revenue of $123.4 million (+10.0%)
- Oracle Corp. (NASDAQ: ORCL): $0.27 per share (+18.5%) on revenue of $5.5 billion (+18.6)
- IHS Inc. (NYSE: IHS): $0.48 per share (+10.4%) on revenue of $213.7 million (+16.6%)
- CKE Restaurants Inc. (NYSE: CKR): $0.20 per share (+10.0%) on revenue of $352.8 million (-2.8%)
- Dynamex Inc. (NASDAQ: DDMX): $0.42 per share (+9.5%) on revenue of $118.4 million (+9.0)
- General Mills Inc. (NYSE: GIS): $0.88 per share (+8.0%) on revenue of $3.3 billion (+6.7%)
- Kroger Co. (NYSE: KR): $0.41 per share (+7.3%) on revenue of $17.6 billion (+9.2)
- Best Buy Inc. (NYSE: BBY): $0.57 per share (+3.5%) on revenue of $9.7 billion (+11.2%)
- Apogee Enterprises Inc. (NASDAQ: APOG): $0.41 per share (+2.4%) on revenue of $242.0 million (+11.2)
- Adobe Systems Inc. (NASDAQ: ADBE): $0.46 per share (+2.2%) on revenue of $876.7 million (+2.9%)
- Progress Software Corp. (NASDAQ: PRGS): $0.45 per share (+2.2%) on revenue of $127.7 million (+4.8)
- Carnival Corp. (NYSE: CCL): $1.58 per share (-5.4%) on revenue of $4.8 billion (+12.1%)
- Darden Restaurants Inc. (NYSE: DRI): $0.61 per share (-16.4%) on revenue of $1.8 billion (+19.9%)
- CBRL Group Inc. (NASDAQ: CBRL): $0.92 per share (-20.0%) on revenue of $596.0 million (-5.7%)
- Comtech Telecomm Corp. (NASDAQ: CMTL): $0.48 per share (-23.8%) on revenue of $124.6 million (+5.8%)
- FedEx Corp. (NYSE: FDX): $1.18 per share (-25.3%) on revenue of $9.9 billion (+7.4%)
- ConAgra Foods Inc. (NYSE: CAG): $0.24 per share (-29.4%) on revenue of $2.8 million (-4.2%)
- Dress Barn Inc. (NASDAQ: DBRN): $0.30 per share (-37.5%) on revenue of $372.3 million (-2.0%)
- Morgan Stanley (NYSE: MS): $0.77 per share (-44.2%) on revenue of $6.3 billion (-21.0%)
- OMNOVA Solutions Inc. (NYSE: OMN): $0.05 per share (-54.5%) on revenue of $225.0 million (+14.3%)
- Goldman Sachs Group Inc. (NYSE: GS): $1.73 per share (-71.8%) on revenue of $6.2 billion (-49.5%)
Palm Inc. (NASDAQ: PALM) is expected to report that it swung to a loss of 18 cents per share in the most recent quarter, while Pier 1 Imports Inc. (NYSE: PIR) is expected to have narrowed its loss to 24 cents per share.
The takeover of Fannie Mae (NYSE: FNM) and Freddie Mac (NYSE: FRE), as well as this past week's focus on the struggles of Lehman Brothers (NYSE: LEH), has renewed scrutiny on the financials just in time for Goldman and Morgan Stanley's fiscal third quarter results. As the list above indicates, both are expected to report much lower earnings. Goldman offered positive surprises in recent quarters -- $4.58 per share in the previous quarter beat estimates by 34%. Morgan Stanley, on the other hand, offered positive surprises in just two of the past four quarters, including beating by four cents per share ($0.95) in the previous quarter. Goldman, no surprise, as the better long-range EPS forecast at 15.6% to Morgan's 11.8%. However, analysts recommend holding GS but buying MS. Shares of both companies have fallen more than 25% year to date.
FedEx, the world's largest package delivery service, is sometimes seen as a bellwether of the economy. The Memphis-based just this past week boosted its fiscal first-quarter profit forecast due to cost containment and lower-than-expected fuel costs. The anticipated 25.3% drop in earnings year over year mentioned above would also amount to a 18.6% decline from the previous quarter's $1.45 per share. While FedEx missed expectations by a penny in that quarter, in the previous three quarters the company beat expectations. Its long-term EPS growth forecast is 12.8%, which is better than the industry average and that of rival United Parcel Service (NYSE: UPS). The analysts' consensus recommendation is currently to buy FedEx. Shares have crept up more than 3% in the past three months.
Other economic data scheduled to be released this week include:
- Industrial production (Aug. 2008): Monday 9:15 AM
- Consumer price index (Aug. 2008): Tuesday 8:30 AM
- NAHB housing market index (Sep. 2008): Tuesday 1:00 PM
- FOMC interest rate decision (Sep. 2008): Tuesday 2:15 PM
- Housing starts (Aug. 2008): Wednesday 8:30 AM
- Leading economic indicators index (Aug. 2008): Thursday 10:00 AM
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