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The week in preview: Alcoa kicks off a new earnings season

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A new earnings reporting season kicks off this coming week with the quarterly report from Alcoa, the first Dow Jones industrial to report. But investors looking for early signs about the first quarter will be disappointed in what they see from the aluminum producer, assuming that analysts surveyed by Thomson Reuters are neither too optimistic or too pessimistic about those results.

New York-based Alcoa Inc. (NYSE: AA) continued efforts to adjust to economic conditions in the first quarter, including cost cutting, a stock offering, and drastically cutting its dividend. Analysts expect the leading global aluminum producer to report a loss for the quarter of $0.57 per share, compared to a loss of $0.28 per share in the previous quarter, and down from a profit of $0.44 per share in the first quarter of last year. Revenue for the quarter is forecast to have fallen 44.7% from a year ago to $4.1 billion. Alcoa has missed earnings estimates in three of the past four quarters, but the long-term EPS growth forecast is 20.0%, which is better than the industry average. A recent analyst's upgrade and speculation that Alcoa may be a takeover target lifted shares recently. But short interest continues to rise, and the share price of $8.17 is 27.4% lower than at the beginning of the year. That's not much higher than its 52-week low.

Like Alcoa, Pier 1 Imports Inc. (NYSE: PIR) is also expected to report a quarterly loss next week. Companies expected to report lower earnings include Bed Bath & Beyond Inc. (NASDAQ: BBBY), Mosaic Co. (NYSE: MOS), International Speedway Corp. (NASDAQ: ISCA), WD-40 Co. (NASDAQ: WDFC), and Ruby Tuesday (NYSE: RT). But there will be some earnings gainers as well

For a quarter that saw Shaw Group Inc. (NYSE: SGR), open an office in Abu Dhabi, analysts are looking for the engineering and construction contractor to report earnings of $0.61 per share, 27.9% higher than in the same period of the previous year. The company's quarterly revenue is expected to come to $1.8 billion, 5.7% higher than a year ago. The Baton Rouge-based company topped earnings estimates in the past three quarters, by as much as 14%. Though the company reported more than $1 billion in debt in the previous quarter, the long-term EPS growth forecast is 20.5%. Analysts, on average, recommend buying SGR; the Motley Fool recently recognized it as a stock on the upswing. The share price has risen 29.3% in the past three months to $29.51, but is 46.4% lower than a year ago.

Family Dollar Stores Inc. (NYSE: FDO) would seem to be well-positioned to benefit from recession-squeezed consumers, and it did see strong same-store sales in its fiscal second quarter, as well as boosting its quarterly dividend. The discount retailer's earnings for the quarter are expected to have risen 25.0% from a year ago to $0.60 per share. The analysts' forecast has revenue 8.2% higher to nearly $2 billion. Family Dollar topped earnings estimates in the past five quarters, by as much as 13.9%. The long-term EPS growth forecast of 11.8% is better than the retail industry average, and the forward PE ratio estimate of 16.0 is also better than the industry average. Analysts are bullish on Family Dollar for its strong cash flow and its margin-improvement efforts. The share price recently hit a 52-week high of $34.06 and is now 22.4% higher since the beginning of the year.

Tulsa-based industrial construction and services company Matrix Service Co.'s (NASDAQ: MTRX) fiscal third quarter included an acquisition and announcement of a share buyback program. Analysts are looking for a profit in the quarter of $0.26 per share (+15.4%) on revenue of $157.5 million (-13.0%). Looking ahead to the full year, the forecast is for earnings of $1.34 per share (+40.3%) on revenue of $734.7 million (0.5%). Matrix beat earnings estimates in two of the past three quarters, missing by about a penny per share in the second quarter. The long-term EPS growth forecast is only 10.0%, but that's better than those of larger rivals Chicago Bridge & Iron Co. (NYSE: CBI) and Halliburton Co. (NYSE: HAL). Matrix has much less debt than those rivals as well. The First Call consensus recommendation remains to buy MTRX. The share price has bounced back from a 52-week low of $5.00 back in January, but it is still 49.4% lower than a year ago.

From Chattanooga-based Chattem Inc. (NASDAQ: CHTT), a provider of personal care products and dietary supplements such as Icy Hot, Selsun Blue shampoo, and Gold Bond medicated powder, analysts expect to see first-quarter earnings of $1.13 per share, which is 23.0% better than in the previous quarter and 14.2% better than in the year-ago quarter. The forecast revenue of $126.2 million is 4.5% higher than a year ago. Chattem's earnings have tended to beat estimates in recent quarters, but missed by a nickel a share in the fourth quarter. The long-term EPS growth forecast of 11.3%, which is better than that of rival Johnson & Johnson (NYSE: JNJ). The consensus recommendation of analysts is to buy CHTT, but at least one analyst has concerns about Chattem's revenue growth prospects. The share price fell to a 52-week low of $51.00 last week after that warning.

Elsewhere on the economic calendar, look for public debt numbers for March on Monday afternoon, consumer credit outstanding for February on Tuesday afternoon, wholesale trade inventories for February on Wednesday morning, import price index for March and trade balance for February on Thursday morning, and the treasury budget balance for March on Friday afternoon.

Also, the Securities and Exchange Commission meets to weigh uptick revival Tuesday evening.

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Last updated: November 22, 2009: 06:54 PM

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