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The Week Ahead For The Week Of June 11th-15th
This Week: Focus: Earnings Warnings/CPI 1. Introduction 2. Earnings Releases 3. Economic Releases 4. Stock Splits 5. Initial Public Offerings 6. Disclaimer ***********************Our Sponsor************************* BUY, SELL, OR HOLD? Individualinvestor.com rates 150 tech stocks everybody loved...until they lost 60% of their value. Which of these fallen stars will rise again? Click here to find out for free (registration required): http://www.individualinvestor.com/techstars *********************************************************** The Week Ahead: Focus: Earnings Warnings/CPI 1. Introduction Next week corporate earnings releases remain scant, leaving Friday's Consumer Price Index (CPI) data as the main focus of the equity markets. This is especially the case as the Federal Reserve's policy meeting draws near on June 26-27. Earnings warnings will also continue to influence market direction and will weigh heavily into forthcoming Fed policy. The Week Ahead is just another of the many great reasons to subscribe to WallStreetCity.com. Besides incisive industry group analysis and enlightening stock analysis, you also get access to the world's most powerful stock screening tool on the planet, ProSearch - all in one subcription package. We even give you a 30-day FREE trial to this service so you can be sure it suits you, so give us a try. Click below to take a 30-day FREE trial. http://clyde.investools.com/T/A28.146.334.1.113719 ____________________________________________________________ 2. Earnings Releases The only sparks that could happen during the week will likely come from Adobe Systems and CMGI. CMGI's earnings release could generate significant interest because the company appears to be living on borrowed time due to the thundering crash in dot com stocks, which were CMGI's lifeblood. On the flipside, Adobe has exhibited quite a knack for beating earning estimates as it accomplished that task for four straight quarters at an average of 12 percent each quarter. In fact, Adobe has beat estimates by a greater percentage in each of its last three quarters (7.7 percent, 10.3 percent, 14.7 percent, and 15.2 percent, respectively). Can Adobe do it again this quarter? Tune in next week to find out! To view the entire slate of earnings releases next week, click on the link below. In addition, investors may want to listen to the conference calls that accompany a company's earnings release. For a list of conference calls for next week, click on the link after the earnings release link. http://clyde.investools.com/T/A28.146.334.2.113719 http://clyde.investools.com/T/A28.146.334.3.113719 To view more detailed information on The Week Ahead, click the link below and then click on The Week Ahead column. http://clyde.investools.com/T/A28.146.334.4.113719 ____________________________________________________________ 3. Economic Releases Next week major economic data commences with May's retail sales data, and the Federal Reserve's Beige Book survey on regional business activity, which are both slated for release on Wednesday the 13th. Market consensus is calling for retail sales to have risen 0.4 percent in May, off from a revised 0.8 percent increase in April, while the Fed's survey is expected to show declining business activity in most regions of the nation. The producer price index (PPI), core PPI - less the volatile food and energy sectors - jobless claims and business inventories are all due to be published on Thursday the 14th. PPI - a measure of wholesale inflation - is expected to have gained 0.3 percent in May, unchanged from its April showing, with the core rate increasing 0.2 percent in May, also unchanged from its prior posting. U.S. business inventories are likely to have fallen in April, near their 0.3 percent decline in March. The consumer price index (CPI), core CPI - less food and energy, U.S. real earnings, industrial production and capacity utilization, and the University of Michigan's index of consumer sentiment close out the week's major economic data. CPI - the most widely used measure of inflation at the consumer level - is forecasted to have risen to 0.4 percent in May, up from a 0.3 percent decrease in April. The core rate - less food and energy - is forecasted to have increased 0.2 percent, unchanged from the previous month's showing. U.S. earnings adjusted for inflation, or real earnings, are likely to have dropped 0.2 percent in May, from a 0.1 percent decline in April. Industrial production is predicted to have dropped 0.4 percent in May, following April's 0.3 percent decline. Capacity utilization, a measure of plant usage, is expected to post at 78 percent in May, from 78.5 percent April. The University of Michigan's Confidence index - a measure of consumer's sentiment for the economy and personal finances - is forecasted to have fallen to a index reading of 90 in its preliminary June estimate, off from its final May showing of 92. To view a chart outlining the effects of this data on the financial markets click on the link below. http://clyde.investools.com/T/A28.146.334.5.113719 REPORT DATE TIME ------------------------------------------------------------ Retail Sales 6/13 8:30 a.m. EDT Fed's Beige Book 6/13 2:00 p.m. EDT PPI 6/14 8:30 a.m. EDT Core PPI 6/14 8:30 a.m. EDT Jobless Claims 6/14 8:30 a.m. EDT Business Inventories 6/14 8:30 a.m. EDT CPI 6/15 8:30 a.m. EDT Core CPI 6/15 8:30 a.m. EDT U.S. Real Earnings 6/15 8:30 a.m. EDT Industrial Production 6/15 9:15 a.m. EDT Capacity Utilization 6/15 9:15 a.m. EDT U. of Mich Confidence 6/15 10:00 a.m. EDT ____________________________________________________________ 4. Stock Splits For The Week Of June 11th Stock Splits The only stock that will begin trading on a split-adjusted basis on Monday will be Nestle SA {NSRGY}, which will split 2-1. Stocks that are scheduled to split during the remainder of the week are listed in the table below. Company Ticker Split Ex-Dividend Date ----------------------------------------------------------- Equitable Resources EQT 2-1 6/12/01 Laboratory Corp of Amer LH 2-1 6/12/01 Oneok OKE 2-1 6/12/01 Applebees APPB 3-2 6/13/01 Evans Bancorp EVBN 5-4 6/13/01 Johnson & Johnson JNJ 2-1 6/13/01 GTM Holdings GTMH 13-1 6/14/01 Krispy Kreme KREM 2-1 6/15/01 ____________________________________________________________ 5. Initial Public Offerings It is virtually impossible to talk about next week's IPO calendar without giving mention to Kraft Foods {proposed ticker "KFT"}, the second largest initial public offering in U.S. history. KFT is being spun-off from Dow component Philip Morris {MO} in a deal that could be worth as much as $8.4 billion. Given that the massive size will limit the amount of upside realized on the opening day, investors may want to instead focus on the longer-term outlook for the stock. KFT's valuation of 28-30x last year's earnings represents a premium to competitors such as General Mills {GIS} and Sara Lee {SLE}, but is in line with the company's forecasted annual growth rate of 18-22 percent. KFT is valued at 28-30x last year's earnings, which is a premium to competitors such as General Mills and Sara Lee, but given Kraft's leadership across several categories, but is in line with the forecasted annualized earnings growth rate of 18-22 percent range. Investors who are looking to stay away from the hype that surrounds Kraft, may want to give OdysseyRe Holdings {proposed ticker "ORH"} a look. ORH underwrites reinsurance for property and casualty products. The company notes in its SEC filings that premium renewal rates for both insurance and reinsurance policies have been on the rise since the second half of 2000 and could continue to increase over the next several years, with growth rates of 15-20 percent for the U.S. and 20-50 percent for the international markets. Despite this bullish outlook, ORH's proposed price range is very reasonable with a P/E multiple of 12.9-15.3 (astute investors may want to also note that this is a discount to relative to many of the company's peers). Banc of America will serve as the lead underwriter. Details on all of the offerings tentatively scheduled to price next week is listed in the table below. Company Proposed Shares Proposed Ticker (millions) Price Range ------------------------------------------------------------ FMC Technologies FTI 11.1 19 - 21 General Maritime GMR 7.0 17 - 19 Kraft Foods KFT 280.0 27 - 30 OdysseyRe Holdings ORH 17.1 16 - 19 Willis Group Holding WSH 20.0 10 - 12 ***********************Our Sponsor************************* Top Fiber Pick Up 225%+ Since 4/2; Core Buy List Soaring 4/2/01: Steve Harmon says "buy" this fiber-optic bargain. 5/29/01: It's up 225+% with no end in sight! His core buy list has 12 more that can move up just as fast. Get them today with your FREE 30-day trial to Broadband Investor: http://www.investools.com/c/go/BRBN/WSCE-brbnTB7?s=S601 *********************************************************** 6. Disclaimer Wall Street City's The Week Ahead is published solely for informational purposes and is not a solicitation or an offer to buy or sell any stock, mutual fund or other security. The information obtained from internal and external sources is considered reliable, but has not been independently verified for accuracy and completeness. Wall Street City, its employees, and/or officers and directors, may from time to time have a position in the securities mentioned and may sell or buy such securities. Trading involves risk, including possible loss of principle and other losses. Trading results may vary. No representations are being made that these techniques will result in or guarantee profits in trading. Past performance is no indication of future results. 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