This week’s big coming attractions via The Unusual Suspects could have been all about earnings again as the earnings onslaught continues. Our big events we are watching for this coming week based on upcoming news or based upon follow-on trading from last week includes ARM Holdings plc (NASDAQ: ARMH), Dearborn Bancorp Inc. (NASDAQ: DEAR), E*TRADE Financial Corporation (NASDAQ: ETFC), General Electric Co. (NYSE: GE), Guess? Inc. (NYSE: GES), Medifast Inc. (NYSE: MED), Palm, Inc. (NASDAQ: PALM), RadioShack Corporation (NYSE: RSH), Transocean Ltd. (NYSE: RIG), and USG Corp. (NYSE: USG).
We did do a full earnings preview of about 50 big companies on deck this coming week, but we chose not to include that as the focus of The Unusual Suspects because there were too many. In that full preview list, we included a full chart/table with tickers, a 52-week range, P/E ratios, earnings and revenue expectations from Thomson Reuters, and even the dividend yields of each.
This week’s Unusual Suspects continues below…
ARM Holdings plc (NASDAQ: ARMH), the British mobile processor maker, has been ‘the buyout rumor of technology’ this week. Some say Apple Inc. (NASDAQ: AAPL), but then TheStreet.com noted Intel Corporation (NASDAQ: INTC). A week ago this went out at $11.05, and this week it went out at $11.89. The options in this are too thinly traded to be of help, and this company could have been bought at many points in the last decade for far less money than today’s value. Rate this one a coin toss.
Dearborn Bancorp Inc. (NASDAQ: DEAR) is in play, just not merger play. The bank holding company in Michigan is still a story of contraction, but the bank posted such a large profit on managing its assets that this was The biggest bank turnaround story of this current earnings season. Shares were up over 100% at one point on the earnings report this week, then it closed up yet another 33% this Friday. A week ago this was a $1.43 stock. Now it sits at $3.96. This was above $20 in the recent years before the meltdown.
E*Trade Financial Corporation (NASDAQ: ETFC) is under a new CEO Stephen Freiberg, who this week said after earnings metrics that he is more focused on turnaround rather than a takeout scenario. That doesn’t matter. The shares were at $1.74 a week ago, yet they were at $1.90at the close on Friday and that looks to be the highest closing price since Sept. 22, 2009. We have yet to see any capitulation trading nor any blow-off top as though a rumor was becoming reality, but this one is trading on more than just a turnaround story.
General Electric Co. (NYSE: GE) has its annual shareholder meeting this week, and I am supposed to have an exclusive interview lined up. We still hold out some slight hope that GE will hike the dividend, although Jeff Immelt and Keith Sherin have said enough times that 2011 will be the year for dividend growth that I am losing faith in a dividend hike coming sooner rather than later. At $19.07, its 52-week trading range is $10.50 to $19.69 and it is technically up about 200% from lows seen at the peak of the panic selling in early 2009.
Guess? Inc. (NYSE: GES) was given a positive feature story in Barron’s this weekend. The clothing maker shares have already doubled, yet Barron’s noted shares could rise another 25% or so from here due to growth opportunities in emerging markets and due to it being cheaper than peers. In a static market, this could be worth 2% to 3% on Monday.
Medifast Inc. (NYSE: MED) took over FINALLY for Lululemon Athletica (NASDAQ: LULU) as the #1 of the IBD 100 after a multi-week consecutive top spot. A week ago this was a $29.50 stock, and this week it closed out at $30.94. IBD said the “healthcare products maker earnings’s accelerate for 3 consecutive quarter.” While the 52-week low is all the way down at $5.16, this is not even close to the 52-week high of $36.58 from December.
Palm, Inc. (NASDAQ: PALM) was up all day Friday, but perhaps on a different rumor than a merger. The buzz around the campfire now is that Palm is going to restructure and CEO Rubenstein may be out. Good luck. This closed up 3.5% at $5.03 and the rumor mill persists here in Palm.
RadioShack Corporation (NYSE: RSH) is up for earnings on Monday. Thomson Reuters estimates are $0.36 EPS on revenues of $1 billion. Frankly, at $23.17 and a 52-week range of $11.26 to $24.00 all we care about is how Julian Day addresses the long-standing buyout chatter that has been on the street for weeks.
Transocean Ltd. (NYSE: RIG) did not participate in Friday’s strength seen in many peers, mostly due to ongoing safety and business model concerns after it lost a rig this week in a deadly accident in the Gulf of Mexico. The stock closed down over 2% from the week’s highs, but it actually closed UP for the week at $89.89 vs. $86.96 the week before. Analysts still have an average of $105 or higher on the stock.
USG Corp. (NYSE: USG) was up almost 6% Friday on far more volume than you even see with earnings reports. This was on positive homebuilder sentiment but the issue on top of 7.3 million shares versus 1.4 million on average trading, this one had extremely active Call buying in the $25 CALL strike prices for the 3 closest expiration months. This one was trading as though “Rumor Friday” would lead to “Merger Monday” although nothing solid was out.
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JON C. OGG