Alcoa (NYSE: AA) surprised the market this afternoon by posting its first quarterly profit of the year.

The company credited recent cost cutting measures as the main reason for its profit of $77 million during the quarter (75.8% lower than the same period last year), or 4 cents per share excluding certain items. This was a nice surprise to Wall Street, which had expected to see the company show a loss for the quarter of 9 cents per share.

The past two weeks we have seen oil prices steadily trade higher, but the sellers came out today in reaction to rising concern over consumer confidence and pushed prices lower.

Oil dropped under $67 a barrel today as Wall Street learned that consumer confidence had dropped for the second straight month in July. A major reason for low consumer confidence can be attributed to rapidly rising unemployment in the country.

Alcoa Inc. (AA) must have drawn the short straw to be the economic canary in the coal mine decades ago, but for many investors the aluminum maker's earnings are seen as a harbinger of things to come. Judging from Wall Street estimates, expectations are so low, they are almost laughable.

Analysts expect the Dow component to lose 56 cents per share on revenue of $4.08 billion compared with $303 million, or 37 cents, a year earlier on revenue of $7.38 billion, according to estimates by Thomson Reuters. The Pittsburgh-based company reported its first loss in six years in January. Its shares are down about 30 percent this year, even with the recent surge in the stock market.

I've never used a motorcycle before in my life and don't know much about the vehicles, but I recognize that Harley-Davidson, Inc. (NYSE: HOG) is an American icon whose product represents an aspirational brand. Even so, the company and its stock finds itself on hard times. The company's latest earnings report is reflective of the current economic malaise.

The first paragraph of the Q2 release tells me almost all I need to know. Revenues declined almost 3% to $1.57 billion. Net profit on a dollar basis dropped sharply by 23%, coming in at $222.8 million. Diluted earnings per share decreased by nearly 17% to $0.95. These numbers are not good. Also, in terms of cash flow, cash was used to fund operations for the first six months of the fiscal year as opposed to being generated. Yet another negative.

As I write this, Harley-Davidson's stock is up well over 7%. Am I impressed? Not enough to buy. Undoubtedly some of this rise can be attributed to the retreat in oil futures. But do I believe the economy will now be nice to Harley-Davidson? Not yet. The company, like General Motors Corporation (NYSE: GM) and Ford Motor Company (NYSE: F), will still have a rough time selling things that require fuel to run. According to this article, Harley-Davidson did better than expected, but that's little comfort to me. You can make an argument that the stock is cheap, but at the very least, anyone interested in buying it (again, I'm not) better wait till the euphoric rally of the day has faded.

Disclosure: I don't own any company mentioned; positions can change at any time.

Classic blue-chip tech company IBM (NYSE: IBM), whose colleagues include Dell (NASDAQ: DELL), Microsoft (NASDAQ: MSFT) and Hewlett-Packard (NYSE: HPQ), is due to report earnings on Thursday after the market closes up shop. What are investors looking for? Growth, of course. Should they expect it?

Well, according to Trey Thoelcke's earnings data, Wall Street is looking for IBM to deliver earnings per share around the $1.82 mark for the second quarter. Revenues should be near $25.9 billion. If Big Blue hits both of these numbers, it would show that the company is coming along fine and that the current level of the stock price is justified. Of course, Wall Street doesn't want IBM to merely hit those numbers. Oh no, that would be too easy. Wall Street wants IBM to beat those expectations. In terms of the bottom line, there is positive recent history for an earnings beat. The company handily beat estimates in the last two quarters, and met expectations in the two quarters previous to that time frame.

Will the company beat expectations? I think it will. The momentum seems to be favorable for such an outcome. In fact, in a relative sense, the stock isn't signaling a terrible report by any stretch of the imagination. The 52-week low is $97.04 and the 52-week high is $129.99. IBM closed up on Wednesday over 2% to a share price of $125.94. Doesn't sound like the market is worried, does it?

Update July 7, 2008: Aluminum giant Alcoa Inc. (NYSE: AA) will post second quarter 2008 results after the close on Tuesday, July 8. Read our preview.

Alcoa Inc. (NYSE: AA) will officially kick off earnings season when it reports its fourth quarter figures Wednesday following the market close.

When we get Wednesday's report, analysts are expecting to see the numbers impacted by a lower dollar and falling metal prices. Estimates for the quarter are running at 39 cents per share. During the fourth quarter last year Alcoa posted earnings per share of 74 cents.

The market can definitely use some positive news from Alcoa when it reports. With this mornings employment data stoking fears of an upcoming recession, the market could definitely benefit from a injection of positive earnings news.

Ted Allrich is the founder of The Online Investor and author of the just released book: Comfort Zone Investing: Build Wealth And Sleep Well At Night. In this weekly column, he'll offer advice to investors who are just getting started.

Earnings are released this week and for the next several. Investors will be scouring the headlines, looking for their stocks' results. Here are some things to check.

Earnings: They're the first number every investor wants to see. But just seeing the earnings per share (eps) isn't enough. You want to know how those earnings were achieved. The ideal: eps grew because more widgets were sold or more hours were billed or more of whatever the company sells is being sold. That's in contrast to eps increasing because of asset sales or a division being sold or some other extraordinary event. Those will only happen one time and won't continue to increase earnings in the future. You'd like to see earnings growing faster than revenues. It shows better efficiencies at the company and suggests future growth will be as profitable or more so because of these efficiencies.

Nike (NYSE: NKE) took its turn in the earnings confessional last night, announcing a 32% jump in fourth-quarter profit. The athletic-apparel giant said net income for the latest reporting period hit $437.9 million, or 86 cents per share, up from $332.8 million (64 cents per share) in the year-ago period. Revenue was 9% higher for the quarter at $4.4 billion. According to MarketWatch, these figures were on par with analysts' expected per-share earnings of 86 cents and revenue target of $4.36 billion.

A global look at the company's fundamentals reveals that markets are stabilizing in France and the U.K., according to executives. Additionally, Asian revenue rose 7% during the latest quarter, with China poised to become Nike's second-largest market in a matter of years. In the U.S. (Nike's largest market), revenue rose 10% to $1.6 billion.

The company's other brands, including Cole Haan and Hurley International, collectively expanded by 16%. The Converse brand was a particular overachiever, with revenue spiking 23%. Which reminds me, I still need to pick up some hot-pink "Chucks."

Inventory levels were improved at Nike, down from double-digits to just 2%.

On Monday evening, I noted the recent struggles Nike stock has had with its 10-day and 20-day moving averages. Today's jump in the shares - a 5.5% rise out of the gate - has been enough to lift the stock solidly through these technical barriers. The next challenge for the stock is its all-time high of $57.58 (pegged earlier this month), currently less than 2% away.

Beth Gaston Moon is an analyst at Schaeffer's Investment Research.

Sprinting into the earnings confessional tomorrow after the closing bell sounds is Nike Inc. (NYSE: NKE), the ubiquitous maker of stylish kicks and apparel for fitness-and-fashion-minded folks. According to Briefing.com, analysts with Reuters are expecting the king of the "swoosh" to bank 85 cents per share in its fourth quarter; analysts polled by Zacks expect 86 cents; both projections exceed year-ago estimates of 69 cents per share.

Technically speaking, Nike has been in rally mode since last August, gaining more than 45% in slightly more than 10 months. The stock has benefited from support at its 10-week and 20-week moving averages; while last week's broad-market pullback dropped the stock below these short-term trendlines, Nike has risen 3% today to retake control of these supportive averages.

My mentor Bernie Schaeffer has taught me to always gauge investor and analyst expectations ahead of an earnings release, as inflated expectations can lead to a disappointing reaction following the report. It seems as though optimism is running fairly high on the footwear retailer. Options players are showing a preference for call positions, which means a sense of bullishness, especially among short-term speculative players. Short interest is low -- the latest numbers show a short-interest ratio of just 2.1 days to cover despite a 19% jump in NKE shorted shares. Finally, analysts are already favoring the bullish camp. Recent Zacks data indicates six "buy" ratings and two "holds," leaving precious little room for upgrades.

It is true that Nike's recent uptrend provides some justification for this optimism. But when expectations are bloated, there is the concern that earnings will not be well received, even if they manage to match or exceed analysts' estimates.

Beth Gaston Moon is an analyst at Schaeffer's Investment Research.

A couple of months ago, I mentioned that while a Coach (NYSE: COH) handbag can be quite the splurge, shares of the luxury-goods retailer could potentially be a prudent investment. Since this posting, the stock has gained nearly 15%, hitting a new all-time high in Monday's session.

This morning, the company said its third-quarter net income surged 38 percent, to $150 million, or 40 cents per share. Revenue increased 30 percent to $625.3 million. Both of these figures surpassed analysts' expectations of 38 cents per share and $617.6 million, respectively.

Peeking in on sales, direct-to-consumer sales rose 29 percent to $481 million, while same-store sales expanded 20 percent. The newly introduced Coach fragrance accounted for three percent of retail sales during the latest reporting period. No word on what percentage of COH sales came from various car trunks in Manhattan.

Quarterly reports continue to roll out, as we're in the thick of earnings season. This past week we asked you, Blogging Stocks readers, for your expectations ahead of earnings reports from some of our favorites -- namely, eBay Inc. (NASDAQ:EBAY), McDonald's Corp. (NYSE:MCD), Johnson & Johnson (NYSE:JNJ), Advanced Micro Devices Inc.(NYSE:AMD), Sun Microsystems Inc. (NASDAQ:SUNW), Yahoo! Inc. (NASDAQ:YHOO), AT&T Inc. (NYSE:T), Ford Motor Co. (NYSE:F), and Microsoft Corp. (NASDAQ:MSFT).

So how did readers do at predicting earnings when compared to Wall Street? It looks like a tie to me, seven out of nine predicted correctly in each case. Let's look a little closer at what you expected.

You had little doubt that several of these stocks would beat expectations: EBAY (70% for beat), MCD (72%), SUNW (72%), T (73%), and even JNJ (59% for beat, against 39% for meet). You correctly picked MSFT to beat expectations as well, but with a bit more uncertainty -- 45% picked beat, against 40% just to meet. And while YHOO beat analysts' expectations, too, only 34% of you thought it would; 39% picked meet.

Ford was one of our favorite underdogs in the Best & Worst of 2006. Perhaps such sentiment played a part in why you were nearly split three ways on Ford in this poll, with 35% to beat, 34% to meet, and 31% to miss expectations. Unfortunately, despite your optimism Ford fell spectacularly short.

Poll results were fairly close on AMD as well, perhaps because of AMD's ongoing rivalry with Intel Corp.(NASDAQ:INTC) -- 26% of you picked it to beat, 32% to meet, and 42% to miss expectations. Despite Wall Street's low expectations, AMD fell short, as the largest portion of you predicted. Congratulations.

Upcoming earnings reports include Sony, Google, Starbucks, and Time Warner. Check out these and other earnings reports that we're following, and let us know what you're expecting.