Here are some highlights from last week's earnings coverage from BloggingStocks:

• Adobe Systems Inc. (NASDAQ: ADBE) just beat low Q3 earnings estimates but revenue also declined.
• Best Buy Co. Inc. (NYSE: BBY) earnings fell short of estimates but revenue was better than expected.
• Cracker Barrel Old Country Store Inc. (NASDAQ: CBRL) posted better-than-expected Q4 earnings.
• Discover Financial Services (NYSE: DFS) posted a surprise Q3 profit but shares rose slightly on the news.
• Dress Barn Inc. (NASDAQ: DBRN) reported modest growth in both net income and revenue in Q4.
• FedEx Corp. (NYSE: FDX) said that its Q1 earnings and revenue dropped but its cash flow has improved.

Discover Financial Services (NYSE: DFS), a credit card company that competes with Visa (NYSE: V), MasterCard (NYSE: MA), and American Express (NYSE: AXP), released earnings for the third quarter on Thursday. The company put analysts to shame by posting a profit instead of a loss according to an article from Reuters.

The projection was for a loss of 12 cents per share. Discover actually made 52 cents per share of profit, once you exclude monies received from an antitrust settlement. Wow, that's what you call being way off the mark! The disparity surprised me, so I went to our very own earnings preview to see what we were reporting for an estimate. Sure enough, it stated the exact same expectation for a loss of 12 cents.

Memphis-based package delivery giant FedEx Corp. (NYSE: FDX) is generally seen as an indicator of the state of commerce in the U.S. Last week, not only did the Fed's Beige Book report suggest that the economy had stabilized over the summer, with signs of recovery in some districts, But FedEx also boosted its earnings guidance due to stronger-than-expected volume in its international priority-delivery service. So a question going in to FedEx's fiscal first-quarter report this week is whether the company is still a bellwether.

For the three months that ended in August, when FedEx opened distribution hubs in Chicago and Toledo and declared a quarterly dividend, analysts surveyed by Thomson Reuters are looking for it to report that earnings fell 60.2% from a year ago to $0.49 per share. That's also down 23.4% from the previous quarter, as well as less than the recently updated outlook. First quarter revenue is expected to be down 18.3% from a year ago to $8.2 billion.

Here are some highlights from this past week's earnings coverage from BloggingStocks:

• Adobe Systems Inc. (NASDAQ: ADBE) Q2 earnings were in line with expectations but sales beat.
• Best Buy Inc. (NYSE: BBY) beat earnings estimates for Q1, but on horrible metrics, sending shares lower.
• Carnival Corp. (NYSE: CCL) lower Q2 earnings beat expectations and previous guidance, boosting shares.
• CarMax Inc. (NYSE: KMX) Q1 profit and sales dropped, but still beat expectations, sending shares higher.
• Discover Financial Services (NYSE: DFS) posted a smaller-than-expected Q2 net loss and shares rose.

On Tuesday, the Federal Reserve's FOMC holds two-day meeting on interest rates and will announce its decision on Wednesday. The Fed's Ben Bernanke will still be out and about this week, discussing the failure of Lehman Brothers later today, and ending up the week speaking at the Independent Community Bankers of America National Convention and Techworld.

Manufacturing will be in focus this week, starting with industrial production numbers for February and the Empire State Manufacturing Survey Diffusion Index for March scheduled to be released Monday morning. Tuesday morning will bring us the Producer Price Index for February, and Thursday morning comes the Philadelphia Fed Outlook Survey -- Diffusion Index Manufacturing for March.

How painful is spending money? Dan Ariely, who teaches behavioral economics at Duke University, has conducted a group of experiments dealing with how painful spending money really is. He asked people if, when they were dining out, they would prefer to pay with cash or by credit card. The overwhelming response was that they preferred to use the credit card.

He concluded that people feel that it's less painful to pay by credit card. He also suggests that people will spend more money with credit cards than with cash because credit card buying is less painful.

Here are some highlights from this past week's earnings coverage from BloggingStocks:

• Adobe Systems Inc. (NASDAQ: ADBE) posted strong Q4 and full-year results, but with flat Q4 revenues.
• Best Buy Inc. (NYSE: BBY) beat Q3 expectations though earnings tumbled, and shares rose about 18%.
• Carnival Corp. (NYSE: CCL) announced that it had lowered its full-year earnings and revenue guidance.
• Discover Financial Services (NYSE: DFS) net income from continuing operations more than doubled in Q4.
• Eaton Corp. (NYSE: ETN) cut its Q4 earnings guidance on weakness in the American auto market.
• FedEx Corp. (NYSE: FDX) Q2 earnings topped expectations and it reaffirmed its guidance.
• General Electric Co. (NYSE: GE) declined to provide quarterly earnings guidance in its annual outlook.
• General Mills (NYSE: GIS) posted a higher-than-expected profit on cost cutting and increased marketing.
• Gilead Sciences Inc. (NASDAQ: GILD) strong earnings growth are expected by one analyst to continue.
• Goldman Sachs Group (NYSE: GS) swung to an anticipated Q4 loss and reported negative revenues.
• Healthcare Realty Trust Inc. (NYSE: HR) was downgraded due to its near-term earnings prospects.
• Honeywell International Inc. (NYSE: HON) affirmed a lower 2009 outlook and said it expects profits to fall.

With the increasingly regular announcements of layoffs and plant closings, it's clear that the recession is deepening. One clue to the economy's future direction that investors may be watching for is the upcoming earnings release of FedEx Corp. (NYSE: FDX). The world's largest delivery service has been considered an economic bellwether, and it just may have benefited recently from lower fuel prices and the announced departure of rival DHL from the U.S. package market.

For the company's fiscal second-quarter 2009 report, analysts surveyed by Thomson Reuters on average expect to see earnings of $1.57 per share, about 2% higher than in the year-ago period, and 21.7% higher than in the previous quarter. That's about the same as the $1.58 per share FedEx forecast in preliminary results last week. Analysts expect revenues for the quarter ended November 30 to total $9.8 billion, 3.9% more than a year ago. The Memphis-based company has only fallen short of earnings expectations in one of the past five quarters, and exactly matched estimates back in the first quarter.

As part of its expansion plans, FedEx broke ground on a new Portland hub in October, and said that a new facility in China will be fully operational in the first half of 2009. The company continues to make service improvements, and declared a quarterly dividend in November. But in its preliminary results, FedEx lowered its full-year forecast, citing continued weakness in the economy.

Visa (NYSE: V), the famous credit and debit card business, which competes with MasterCard (NYSE: MA) and American Express (NYSE: AXP), reported results for the fourth quarter on Thursday. I came away from them feeling pretty bullish.

No, it wasn't so much the numbers as it was the fact that the credit-card concern constructed a litigation settlement with Discover (NYSE: DFS). The latter had antitrust issues with Visa, and it was a part of the company's story that bothered me. Visa will pony up almost $1.9 billion to Discover to make everything hopefully okay between the two (for more about the settlement, check out Elizabeth Harrow's post). Most of the money was already set aside in a fund in anticipation of the settlement. That's awesome.

And as for earnings, well, Visa lost money on a GAAP basis during Q4 driven by the litigation provision. But on an adjusted basis, excluding that provision and other charges, Visa earned $0.58 per diluted share. That was a penny better than Wall Street expectations.

This makes the Visa story even more attractive than it already was. Honestly, as a long-term investment, Visa should be a winner. I know the economy doesn't rule right now, but I don't think there's anyone out there who believes that credit cards are going away.

The quarter is winding down, and here are some highlights from this past week's earnings coverage from BloggingStocks:

• Air Products & Chemicals Inc. (NYSE: APD) lowered its guidance for the current quarter.
• AutoZone Inc. (NYSE: AZO) missed Q4 earnings estimates despite a modest increase in profits.
• Bed Bath & Beyond Inc. (NASDAQ: BBBY) reported disappointing Q2 results that met analysts' expectations.
• Chevron Corp. (NYSE: CVX) faces earnings declines if the Paulson plan fails, says Jim Cramer
• Circuit City Stores Inc. (NYSE: CC) earnings declines finally led to the ouster of CEO Schoonover.
• Discover Financial Services (NYSE: DFS) beat Q3 expectations despite charges and reserves.
• General Electric Co. (NYSE: GE) lowered its Q3 and full-year forecast due to financial sector woes.
• KB Home (NYSE: KBH) reported a greater-than-expected loss for Q3, and yet shares rose.
• Lennar Corp. (NYSE: LEN) posted significantly smaller Q3 losses on cost cutting.
• McCormick & Co. Inc. (NYSE: MKC) topped Q3 expectations due to the sale of a brand.
• Nike Inc. (NYSE: NKE) posted better-than-expected Q1 results despite a decline in net income.
• Research in Motion Ltd. (NASDAQ: RIMM) posted strong Q2 results accompanied by a weak forecast.
• Rite Aid Corp. (NYSE: RAD) Q2 net loss more than doubled and revenues were flat
• Secure Computing Corp. (NASDAQ: SCUR) missing estimates didn't stop a deal with McAfee (NYSE: MFE).
• 3Com Corp. (NASDAQ: COMS) Q1 results topped both analysts estimates and previous guidance.
• 3M Co. (NYSE: MMM) faces significant earnings declines if the Paulson plan fails, says Jim Cramer.

Also, are analysts' expectations for the the coming year too optimistic?

Upcoming quarterly reports include Circuit City (NYSE: CC), Walgreen (NYSE: WAG), Pepsi Bottling Group (NYSE: PBG), Constellation Brands (NYSE: STZ), Marriott International (NYSE: MAR), Family Dollar Stores (NYSE: FDO).

Visit AOL Money & Finance for more earnings coverage.

Earnings reports continue to dribble in as the quarter winds down. Much of the attention this week will be on homebuilders KB Home (NYSE: KBH) and Lennar Corp. (NYSE: LEN) as investors look for any sign that the housing sector has bottomed (home sales numbers are also due out this week; see below). Analysts surveyed by Thomson Financial anticipate that both companies will report that they narrowed their losses in the most recent quarter.

KB Home's expected $1.25 per share loss, on revenue of $725.5 million, compares to the previous quarter loss of $3.30 and to a year-ago loss of $6.19. However, KB Home's losses in the past few quarters have been deeper than expected. The Los Angeles-based homebuilder's long-range earnings growth forecast is 10.5%, less than the S&P 500. Analysts continue to recommend holding KB Home, and have for at least 120 days. Shares, however, reached a new 52-week high of $31.69 on Friday, and they are up 10.5% year to date.

Lennar is expected to post a loss of 52 cents per share, on revenue of $1.1 billion. That compares to the previous quarter's per-share loss of 76 cents and to a year-ago loss of $3.25. While Lennar also has tended in the past few quarters to miss expectations, the Miami-based company managed a positive surprise in the first quarter of 2008. Lennar's long-range earnings growth forecast is 10.3%, about the same as KB Home's. Analysts also recommend holding Lennar. Friday, shares of Lennar also reached a 52-week high, $27.75, but they are down 6.4% year to date.

American Express (NYSE: AXP) closed at $37.43 Wednesday. Friedman Billings Ramsey says "Considering AXP needs to roll over 32% of its total managed debt (both corporate debt and securitized debt) within the next six quarters, we believe there is a risk there could be a material increase in the funding costs for AXP and thus materially reduce profitability." AXP overall option implied volatility of 48 is above its 26-week average of 45 according to Track Data, suggesting slightly larger price movement.

Capital One Fin'l (NYSE: COF) closed at $41.29 Wednesday. COF October option implied volatility of 76 is above its 26-week average of 65 according to Track Data, indicating larger price movement.

Discover (NYSE: DFS), an electronic payment services company, closed at $14.59 Wednesday. DFS overall option implied volatility of 63 is above its 26-week average of 60, suggesting non-directional price movement.

MasterCard (NYSE: MA) closed at $243.32 Wednesday. MA overall option implied volatility of 43 is near its 26-week average, indicating non-directional price fluctuations.

Visa (NYSE: V) closed at $74.57 Wednesday. V September option implied volatility of 42 is near its 23-week average, suggesting non-directional price movement.

Option Update is provided by Stock Specialist Paul Foster of theflyonthewall.com

Here are some highlights from this past week's earnings coverage from BloggingStocks:

• Andersons Inc. (NASDAQ: ANDE) lifted its outlook on improved performance of its Plant Nutrient Group.
• BP Plc (NYSE: BP) was upgraded by Societe Generale due in part to its earnings prospects.
• Citigroup Inc. (NYSE: C) has developed an earnings improvement plan based on collective bonuses.
• Corel Corp. (NASDAQ: CREL) solid Q2 results did not address a buyout offer from Vector Capital.
• Discover Financial Services (NYSE: DFS) Q2 earnings were boosted by dumping its Goldfish card division.
• Fortune Brands Inc. (NYSE: FO) lowered its earnings outlook on challenging consumer environment.
• Isle of Capri Casinos Inc. (NASDAQ: ISLE) blamed dismal results on floods and smoking bans.
• MSCI Inc. (NYSE: MXB) strong Q2 results didn't save it from being dumped by Morgan Stanley (NYSE: MS).
• PAREXEL International Corp. (NASDAQ: PRXL) lifted its Q4 and full-year guidance, leading to an upgrade.
• Texas Industries Inc. (NYSE: TXI) was downgraded due to fears about its earnings prospects.
• Taleo Corp. (NASDAQ: TLEO) reaffirmed its outlook as an acquisition would boost results.
• WD-40 Co. (NASDAQ: WDFC) posted solid Q3 results and offered conservative guidance.

More highlights from this past week: Apollo Group, Family Dollar, Kroger, Deutsche Bank and others

Also, while Jim Cramer ponders what will signal the bottom, many investors will be looking at next week's earnings results for General Electric (NYSE: GE), the world's largest conglomerate, as a sign of the direction of the global market. And BusinessWeek reminds us that cheap stocks -- even with big names such as Ford Motor Co. (NYSE: F), Sprint Nextel Corp. (NYSE: S), and Northwest Airlines (NYSE: NWA) -- are no bargain if they have no earnings.

Upcoming results to watch for include Alcoa (NYSE: AA), Pepsi Bottling Group (NYSE: PBG), Marriott International (NYSE: MAR), and General Electric (NYSE: GE).

Visit AOL Money & Finance for more earnings coverage.

It's been about a year since Discover Financial Services (NYSE: DFS) became a public company. Unfortunately, the stock performance has been miserable -- going from $31 to $13.57.

Yet, the company keeps making money. In the latest quarter, Discover posted net income of $234 million, or $0.48 per share, which compares to $209.2 million, or $0.44 per share in the same period a year ago. The company got a boost from its unloading of its Goldfish card division (a UK credit card company).

No doubt, Discover must deal with the slowing U.S. economy. But, the good news is that the company has been relatively conservative with its credit standards and has long-time customers (which helps provide more stability). However, there is still a rise in delinquencies and charge-offs. For example, overdue loans (for the past 30 days) has gone from 2.71% to 3.54% over the past year.

Now, Discover does have key asset advantage; that is, it operates its own processing network. This is certainly a solid business as people increasing use credit cards and other electronic payments. In fact, Discover recently purchased Diner's Club International, which also has its own processing network.

Unfortunately, Wall Street isn't interested. The belief is that -- as the economy remains sluggish -- there is likely to be a drag on the growth of Discover.

Tom Taulli is the author of various books, including The Complete M&A Handbook and The Edgar Online Guide to Decoding Financial Statements. He also operates MergerBook.com.

I love the long-term prospects of Visa (NYSE: V) and MasterCard (NYSE: MA), but I do have to concede that a pesky lawsuit by Discover (NYSE: DFS) is the one big fly in this story's soup. According to the following article, Discover wants both credit-card companies to pay $6 billion for perceived violations of antitrust regulations. Unfortunately, these damages could be tripled if Visa and MasterCard lose. One of the big problems here is that American Express (NYSE: AXP) already won a settlement of $2.1 billion from Visa late last year and the company established an escrow fund worth $3 billion for litigation payments.

I'll admit, this lawsuit does give me and my credit-card investment thesis a little case of the shivers. After all, tripling $6 billion to $18 billion means that a huge amount of money is in play here, and a successful outcome for Discover would hamper the stocks of the two big card entities. When you read through the litigation risks in Visa's SEC filings (out of MasterCard and Visa, the latter is my favorite since it is still relatively fresh off its IPO and MasterCard has already had a big run), they are pretty scary. And the fact that the $6 billion figure just came to light this week has probably soured the perception of some investors and analysts. Nevertheless, all the previous litigation talk didn't stop Visa's stock from taking off after its IPO earlier this year.

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