The new earnings season ramps up this week as Alcoa Inc. (NYSE: AA) reports fourth-quarter results. Last week, the Pittsburgh-based producer of aluminum and alumina announced layoffs and production cuts as a reaction to the economic downturn. Analysts surveyed by Thomson Reuters expect that Alcoa will have swung to its first quarterly loss in years: $0.10 per share. That compares to a profit of $0.36 per share in the same period of the previous year. Revenues for the quarter are expected to have fallen 28.8% from a year ago to $5.3 billion. For 2008, analysts are looking for earnings of $1.40 per share on revenue of $27.6 billion, down from $2.60 per share and $30.8 billion in the previous year. Alcoa missed earnings estimates in three of the past five quarters, by 25.4% in the third quarter. The consensus recommendation of analysts shifted from buy to hold AA during the past quarter. The share price has been climbing in recent weeks, but it is 65.6% lower than a year ago.
Intel Corp. (NASDAQ: INTC) is also scheduled to report fourth-quarter results this week, one of a handful of tech stocks to do so. The number one semiconductor maker is expected to post earnings down 86.8% to $0.05 per share, and sales of $8.2 billion, down 23.3% from a year ago. Last week, Intel forecast sales for the quarter of $8.2 billion. The full-year numbers are expected to be marginally lower than a year ago, or $0.94 per share on $37.7 billion. Intel only missed earnings estimates in one of the past five quarters. Shares are about $2.00 higher than the 52-week low, but 37.2% lower than a year ago.
Other tech companies reporting this week include Indian IT firm Infosys Technologies Ltd. (NASDAQ: INFY), which is expected to post marginally higher fiscal third-quarter earnings, and integrated circuits maker Xilinx Inc. (NASDAQ: XLNX) and linear device maker Linear Technology Corp. (NASDAQ: LLTC), which are expected to report marginally lower earnings. Analysts expect Netherlands-based ASML Holding (NASDAQ: ASML), which produces semiconductor manufacturing equipment, to report that fourth-quarter earnings fell 97.0% from a year ago to $0.02 per share as it restructures in response to a severe drop in demand due to the economic downturn.
Among regional banks scheduled to report fourth-quarter results, analysts expect some earnings growth from Bank of the Ozarks Inc. (NASDAQ: OZRK) and Westamerica Bancorporation (NASDAQ: WABC), while Simmons First National Corp. (NASDAQ: SFNC) and Home Bancshares Inc. (NASDAQ: HOMB) are expected to post declines in earnings. First Horizon National Corp. (NYSE: FHN), which gained a new CFO this past quarter, is expected to narrow its loss to $0.34 per share from $1.88 per share in the same period a year ago. Revenue is expected to have grown 42.8% to $455.5 million. Though the Memphis-based lender's losses have been deeper than estimated in recent quarters, analysts on average recommend buying FHN. Shares are 21.1% higher than they were three months ago.
Marshall & Ilsley Corp. (NYSE: MI), which participates in the FDIC's Temporary Liquidity Guarantee Program, is expected to post a fourth-quarter profit of $0.09 per share on revenue of $629.4 million. That compares to a $0.32 per share profit in the third quarter and to a loss of $0.09 per share on revenue of $629.9 million in the fourth quarter of last year. The Milwaukee-based lender's results have been better than expected in the past three quarters. For the full-year, analysts are looking for a net loss of $0.57 per share on revenue of $2.5 billion (+6.6%). Shares have fallen 28.7% in the past three months, and they are 53.4% lower than a year ago.
Another expected big earnings gainer scheduled to report this week is biotech company Genentech Inc. (NYSE: DNA). Its fourth-quarter profit is expected to be $0.96 per share, with revenue totaling $3.7 billion. In the year-ago fourth quarter, the profit was $0.69 per share on revenue of $2.9 billion. The company missed per-share earnings estimates by a few pennies in the previous two quarters. The consensus recommendation is to buy DNA. Shares have risen 18.3% in the past three months, and the share price is 21.8% higher than it was a year ago.
The week's other anticipated big earnings decliners include PPG Industries Inc. (NYSE: PPG), maker of Lucite paint, Olympic stain, and other chemical and glass products, as well as Milwaukee-based Johnson Controls Inc. (NYSE: JCI). PPG is expected to report fourth-quarter profits 65.3% lower to $0.41 per share, and sales of $3.5 billion. Johnson Controls is expected to post fiscal first-quarter earnings of $0.06 per share, down 84.6%, on sales of $8.6 billion. Both companies have mostly met or just beat estimates in the past five quarters. The share prices of both are up somewhat from their multiyear lows back in November, but shares are more than 33.0% lower than a year ago.
Reader Comments (Page 1 of 1)
1-11-2009 @ 8:11PM
George said...
This downturn is beginning to look serious. Intel and Alcoa could be bellweather indicators.
1-11-2009 @ 10:08PM
bernie said...
How profound, George. Haven't heard that perspective anywhere. Maybe there's a cabinet spot open for someone with such wisdom.
1-11-2009 @ 10:58PM
cmountaindave said...
Let me get this straight George; Uncle Sam can spend way more than he makes, but I can't. Well, now that hardly seems fair, now does it.
Besides, if I Check Out before my mortgage is paid, the bank gets my property, right? It's not like they got left holding the bag
1-12-2009 @ 1:30PM
azjohnny said...
comrade citizens, the answer is clear: let obama and the donkey party dolts nationalize the company; let product design be centralized in d.c. designing products nobody wants; do not, do not, lay off one employee as all losses will be paid for by the taxpayer - - this will continue indefinitely or until, like the old soviet union, the slaves rise up and cast it off.