10 Key Earnings Previews For Wednesday (ABT, AXP, BAC, DAL, EBAY, HON, IBM, QCOM, USB, YUM)

Wednesday is going to mark yet another important day for the early wave of key earnings for this earnings season.  The second quarter became more challenging for many companies as we noted about so many tech warnings weighing on shares last week.  We have provided some brief earnings previews with Thomson Reuters consensus estimates on each with some added color if applicable.

Earnings are going to be reported by the following major companies on Wednesday: Abbott Laboratories (NYSE: ABT); American Express Co. (NYSE: AXP); Bank of America Corporation (NYSE: BAC); Delta Air Lines Inc. (NYSE: DAL); eBay Inc. (NASDAQ: EBAY); Honeywell International Inc. (NYSE: HON); International Business Machines Corporation (NYSE: IBM); QUALCOMM Inc. (NASDAQ: QCOM); U.S. Bancorp (NYSE: USB); and Yum! Brands Inc. (NYSE: YUM)

Abbott Laboratories (NYSE: ABT) reports Wednesday morning and we are looking for more data on the break-up here.  Estimates are $1.22 EPS and $9.84 billion in revenue. Next quarter estimates are $1.27 EPS and $9.94 billion in revenue.

American Express Co. (NYSE: AXP) reports after the close and this DJIA component is expected to report earnings of $1.09 EPS on revenue of $8.11 billion. Next quarter estimates are $1.06 EPS and $8.07 billion in revenue.  While there have been many credit metric improvements, we are going to pay close attention to see if its credit metrics are able to keep improving much on top of what we have seen of late as the most recent Treasury report showed that consumers are carrying more revolving credit and that means higher credit card debt.

Bank of America Corporation (NYSE: BAC) will prove whether it can post the same upside to reports as other banks have.  The report will come early in the morning and estimates are $0.14 EPS and $22.87 billion in revenue.  As a reminder, its past book value per share is likely going to act as a ceiling rather than a floor for quite some time ahead.  The first quarter book value per share was $19.83 and its tangible book value per share was listed as $12.87. At the end of the first quarter BofA noted a record Tier 1 Common Equity Ratio of 10.78% and its Tier 1 capital ratio was 13.37%.

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Delta Air Lines Inc. (NYSE: DAL) reports Wednesday and estimates are $0.68 EPS and $9.68 billion in revenue.  With fuel prices being lower and with planes running full, we care about two key issues here: 1) will it bid on AMR? AND 2) did it over-hedge when oil prices were too high?

eBay Inc. (NASDAQ: EBAY) is a report where we will not be surprised if the guidance is soft due to some communications about online auctions running at a disappointing rate at the moment.  That may not be universal, but that is our understanding of late.  Earnings are due after the close on Wednesday and estimates are $0.55 EPS and $3.36 billion in revenue.  eBay usually offers longer guidance and the consensus estimates are $0.55 EPS and $3.42 billion in revenue for Q2 and $2.35 EPS and $13.98 billion in revenue for all of 2012.

Honeywell International Inc. (NYSE: HON) is the first of the big conglomerates to report earnings and that will come early in the morning on Wednesday.  We expect that Honeywell could act as a mini-proxy to General Electric Co. (NYSE: GE) ahead of its earnings at the end of the week.  Estimates are $1.12 EPS and $9.56 billion in sales for the second quarter and the third quarter estimates are currently $1.15 EPS and $9.68 billion in revenue.

International Business Machines Corporation (NYSE: IBM) is due after the close on Wednesday and its shares are down close to $185 from having peaked at about $210 earlier this year.  IBM is under a new CEO but the weak news from IT-outsourcing firms in the recent six weeks or so leaves it to where IBM cannot likely maintain the same guidance even if it does try to maintain that it can earn $20.00 per share by 2015 and even if it can grow its dividend and share buybacks.  Estimates are $3.42 EPS and $26.3 billion in revenue.  As always, watch its guidance on order backlog: IBM’s estimated services backlog at March 31 was $139 billion, down 2% year over year or up 1% adjusting for currency.  This backlog was actually $141 billion just at the end of 2011.

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QUALCOMM Inc. (NASDAQ: QCOM) will have to confess whether or not the slowdown is jeopardizing the growth of smartphone sales (and tablet PC sales).  The report will come after the close and you just know that investors will try to interpolate what it means for Apple Inc. (NASDAQ: AAPL) ahead of earnings next week.  At almost $55, QUALCOMM is down from its 52-week high of $68.87 so far.  Estimates are $0.86 EPS and $4.68 billion in revenue. Next quarter’s estimates are $0.89 EPS and $4.9 billion in revenue.

U.S. Bancorp (NYSE: USB) is one of the 7 Safest Banks in America and it trades at a premium to its book value.  Its report is due in the pre-market on Wednesday.  Estimates are $0.70 EPS and $4.98 billion in revenue.  Book value per common share was $16.94 at the end of the first quarter and should have grown again, but shares just hit a 52-week high at $33.26 the day before earnings.  Sadly, this may be putting too much of a premium on the safe bank as a technicality for it to qualify as one of the safest banks since we specifically did not allow for banks trading at more than 2.0-times book value in that screen.

Yum! Brands Inc. (NYSE: YUM) is due to report earnings after the market closes on Wednesday and investors will be watching closely to see how bad the Chinese economy is doing at the street level.  Yum! has deep ties to China for its growth of KFC.  Estimates are $0.70 EPS and $3.12 billion in revenue.  With shares close to $64 per share, this stock is down from an all-time high of $74.44 from earlier this year.

JON C. OGG