The week in preview: Eye on Marvel, KBR, First Solar, Deckers and more


Analysts surveyed by Thomson Reuters expected the parade of earnings declines to continue into the final week of February, with Martha Stewart Living Omnimedia Inc. (NYSE: MSO), Nordstrom Inc. (NYSE: JWN), Home Depot Inc. (NYSE: HD), Wynn Resorts Ltd. (NASDAQ: WYNN), Macy's Inc. (NYSE: M), DreamWorks Animation SKG Inc. (NYSE: DWA), Limited Brands Inc. (NYSE: LTD), Target Corp. (NYSE: TGT), Royal Bank Of Canada (NYSE: RY), Del Monte Foods Co. (NASDAQ: DLM), Kohl's Corp. (NYSE: KSS), Washington Post Co. (NYSE: WPO), Dell Inc. (NASDAQ: DELL), Gap Inc. (NYSE: GPS), Campbell Soup Co. (NYSE: CPB), RadioShack Corp. (NYSE: RSH), and H.J. Heinz Co. (NYSE: HNZ) all expected to post lower earnings for the most recent quarter. Office Depot Inc. (NYSE: ODP), Saks Inc. (NYSE: SKS), and Cooper Tire & Rubber Co. (NYSE: CTB) are expect to have swung to a loss.

New York-based Marvel Entertainment Inc. (NYSE: MVL), comic book publisher and licensee of characters such as Spider-Man and the X-Men to moviemakers and toy developers, is expected to be one of the biggest earnings gainers of the week. For the fourth quarter, analysts expect to see a profit of $0.71 per share, 50.7% higher than a year ago, and revenue of $214.7 million, up 96.5%. For the full year, their forecast is $2.54 per share (+33.1%) on $663.7 million (+37.4%). Marvel has topped estimates in recent quarters, by as much as 61.9%. Though the long-term EPS growth forecast is 16.0%, much better than the industry average and the S&P 500, the consensus recommendation has been on the fence between buying or holding MVL over the past quarter. BloggingStocks contributor Steven Mallas remarked on a recent upgrade of Marvel. The company's PE (ttm) is about 10.9. The share price has fallen 22.6% since the beginning of the year, bringing it close to the 52-week low of $23.28. Marvel recently announced that it was extending its license agreement with Hasbro Inc. (NYSE: HAS) until 2017.

Fashionable footwear and accessory designer/retailer Steve Madden Ltd. (NASDAQ: SHOO) is expected to be another big earnings gainer reporting this week. In its fourth-quarter, which includes the holiday shopping season, the profit is expected to have risen 42.5% from a year ago to $0.40 per share. Sales are expected to have risen 11.3% to $114.38 million in the quarter. For the full year, the forecast is for a profit $1.68 per share on revenue of $452.6 million, compared to $1.58 per share on revenue of $431.1 million a year ago. Steve Madden has topped estimates in four of the past five quarters, by as much as nine cents per share. The long-term EPS growth forecast is 15.0%, better than the S&P 500, and the consensus recommendation is to buy SHOO. Minyanville recently include Steven Madden in a list of profitable companies despite the economic downturn. Steven Madden's PE (ttm) is about 12.3. The share price has risen 12.3% in the past three months to $16.78 but is still 6.5% lower than a year ago.

For the fourth quarter, which saw completion of a new facility in southern California and a backlog surpassing $6 billion, Arizona-based First Solar Inc. (NASDAQ: FSLR), is expected to post a profit of $1.30 per share (+40.8%) and revenue of $410.4 million (+104.4%). For the full year, analysts anticipate earnings of $3.92 per share on sales of $1.2 billion, compared to $1.40 per share and $503.9 million in the previous year. This producer of solar power technology has easily topped earnings estimates in recent quarters, and the long-term EPS growth forecast is a whopping 48.5%. Analysts, on average, recommend buying FLSR and have for more than 90 days. First Solar's PE (ttm) is about 39.2. The share price has fallen 2.9% since the beginning of the year to $134.01 but is still 36.5% lower than a year ago.

California-based Deckers Outdoor Corp. (NASDAQ: DECK), is also expected to post earnings growth this week, as footwear makers and retailers did reasonably well in an otherwise difficult holiday shopping season. Analysts are looking for Deckers to report fourth-quarter earnings of $3.95 per share, 31.9% higher than a year ago, and revenue of $299.3 million, up 54.1%. For the full year, earnings are expected to come to $7.17 per share on sales of $684.7 million, compared to $5.06 per share and $448.9 million in the previous year. Deckers has topped earnings estimates in recent quarters, by as much as 28 cents per share. The long-term EPS growth forecast is 22.6%, better than the industry average and the S&P 500. While Deckers received a recent analyst's downgrade, the consensus recommendation remains to buy DECK. The PE (ttm) is about 11.0. While the share price has risen 6.7% in the past three months to $57.60, it is still 52.8% lower than a year ago.

Houston-based KBR Inc. (NYSE: KBR), which was spun off from oil services giant Halliburton Co. (NYSE: HAL) in 2007, is expected to post a fourth-quarter profit of $0.40 per share (+30.0%) and revenue of $3.0 billion (+24.1%). For the full year, analysts anticipate earnings of $1.71 per share on sales of $11.2 billion, compared to $1.08 per share and $8.7 billion in the previous year. This engineering and construction firm has topped earnings estimates in three of the past five quarters, and the long-term EPS growth forecast is 10.7%. Jim Cramer was recently bullish on KBR in a recent Lightning Round, and analysts, on average, recommend buying KBR and have for more than 90 days. KBR has paid a quarterly dividend of $0.05 per share in the past year, its PE (ttm) is about 8.5, and it recently announced a share buyback program. The share price has fallen 11.5% since the beginning of the year to $13.45 but is still 58.9% lower than a year ago.

Flowserve Corp. (NYSE: FLS), the world's largest provider of pumps for the chemical, petroleum, and power industries, is expected to post a fourth-quarter profit of $1.89 per share on revenue of $1.3 billion, compared to $1.36 per share on $1.1 billion in the same period of the previous year. For the full year, earnings are expected to come to $7.49 per share (+44.3%) on sales of $4.6 billion (+21.0%). Flowserve has exceeded earnings estimates in recent quarters, by as much as 62.8%. Though the long-term EPS growth forecast is only 9.2%, the consensus recommendation is to buy FLS. CNBC included Flowserve on a list of infrastructure plays, and the Motley Fool saw the stock as poised to pop. The PE (ttm) is about 6.5. While the share price has risen 18.2% in the past three months to $47.96, it is still 53.0% lower than a year ago.

Digital Realty Trust Inc. (NYSE: DLR), a real estate investment trust (REIT) that owns data centers, Internet communications hubs, and other technology-related properties, recently announced a stock offering of 2.5 million shares. Its fourth-quarter earnings are expected to have risen 26.4% from a year ago to $0.72 per share. Revenue is expected to have risen 36.2% to $144.3 million in the quarter. For the full year, the forecast is for a profit $2.58 per share (+20.5%) on revenue of $526.2 million (+33.1%). This San Francisco-based trust missed estimates in two of the past four quarters, but by only a penny per share. The long-term EPS growth forecast is 23.0% and the consensus recommendation remains to buy DLR. Digital Realty increased its quarterly dividend to $0.33 per share in the past quarter, and its PE (ttm) is about 142.6. The share price has fallen 8.9% since the beginning of the year to $29.95 and is 16.7% lower than a year ago.

In a fourth-quarter that saw consolidation of some operations in reaction to the economic slump, diversified equipment maker and services company Teleflex Inc. (NYSE: TFX) is expect to report a profit of $0.94 per share on revenue of $588.7 million, compared to $0.71 per share on $583.1 million in the same period of last year. For the full year, earnings are expected to rise slightly from a year ago to $3.95 per share on sales of $2.4 billion (+24.4%). Teleflex has topped estimates in most recent quarters, by as much as 14.7%. The long-term EPS growth forecast is 13.8% and the consensus recommendation shifted to strong buy in the past quarter. The most recent quarterly dividend was $0.34 per share, and the PE (ttm) is about 35.2. While the share price has risen 17.9% in the past three months to $49.61, it is still 16.0% lower than a year ago.

Other companies expected to report more modest earnings growth this week include Safeway Inc. (NYSE: SWY), PG&E Corp. (NYSE: PCG), J.M. Smucker Co. (NYSE: SJM), Dollar Tree Inc. (NASDAQ: DLTR), and Salesforce.com Inc. (NYSE: CRM).

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Symbol Lookup
IndexesChangePrice
DJIA-89.2312,801.23
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S&P 500-9.311,342.64

Last updated: February 13, 2012: 05:20 AM

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