Week in Preview: Eye on Parker Hannifin, Devon Energy, DirecTV
But the crush resumes on Tuesday, with quarterly reports from Coach (COH), Harris (HRS), MasterCard (MA), Molson Coors (TAP), Pfizer (PFE), Priceline.com (PCLN) and Whole Foods (WFMI) among those expected to post earnings growth. The highlight of the day, though, may be motion and control technology leader Parker Hannifin's (PH) fiscal fourth-quarter results.
Looking for Solid Results
Analysts anticipate that Parker Hannifin will report earnings of $1.08 per share, up 71.3% from the same period last year. During the three months that ended in June, Parker Hannifin increased its dividend and raised its full-year guidance, and revenue for that period is now expected to have jumped 23.3% to $2.7 billion. For the full year, the consensus forecast calls for $3.10 per share on $9.9 billion. Parker Hannifin's earnings have topped analysts' expectations in the past four quarters, by as much as 28 cents per share.
Parker Hannifin's long-term EPS growth forecast of 11.2% exceeds that of competitors Eaton (ETN) and Honeywell (HON). Its 14.8-times earnings multiple is less than both the industry average and the trailing price-earnings ratio of 26.6. Short interest fell in July, and the First Call recommendation has been to buy PH for more than 90 days. The mean price target on shares is currently $75.75. At $62.12, the share price is 10.2% lower than it was three months ago.
Also on tap Tuesday, Archer Daniels Midland (ADM), CBS (CBS), Dow Chemical (DOW) and Marathon Oil (MRO), which are expected to have more than doubled their earnings per share from a year ago as well. But analysts are looking for earnings declines from Dean Foods (DF) and Nicor (GAS), as well as a loss from Electronic Arts (ERTS).
Another Beat for Devon Energy?
Devon Energy's report could be the one to watch on Wednesday. During the three months that ended in June, Devon sold assets in the Gulf of Mexico and China, and it also declared a quarterly dividend. Analysts expect the Oklahoma City-based oil and gas producer to report that earnings per share came to $1.42, a 40.1% rise from a year earlier. Second-quarter revenue is expected to have grown 12.1% to $2.3 billion. So far, analysts predict sequential and year-over-year growth of both earnings and revenue in the third quarter. Earnings results were better than expected in the past five quarters, beating consensus estimates by 38 cents per share in the first quarter.
Devon's earnings per share growth forecast for 2010 is 15.5%, which is better than the industry average. The earnings multiple of 10.6 is less than the industry average, as well as the trailing price-earnings ratio of 12.2. Analysts on average recommend buying DVN, and their mean price target is $81.75 a share. Shares closed last week at $62.49, which is 7.2% lower than three months ago.
Wednesday's other anticipated earnings gainers include AllState (ALL), Polo Ralph Lauren (RL) and Time Warner (TWX). Analysts expect to see smaller earnings per share from Aol (AOL), Garmin (GRMN), Hartford Financial (HIG), Prudential (PRU), Qwest Communications (Q) and Transocean (RIG), while Toyota (TM) is expected to have swung to a profit from its year-ago quarterly loss.
DirecTV on the Rise
One of Thursday's most anticipated reports will come from DirecTV (DTV), which announced an interactive advertising platform and expanded its HD offerings during its second quarter. Earnings for that period are expected to total 60 cents per share, up from 40 cents per share in the same period of last year. The satellite TV provider's revenue for the three months ending in June is expected to total $5.7 billion, or 9.8% more than a year earlier. Thus far, the consensus forecast is for sequential and year-over-year revenue growth in the third quarter. DirecTV's per-share earnings have been on the rise in the past three quarters, beating consensus estimates in the past two.
DirecTV's long-term earnings per share growth forecast of 22.3% easily tops that of rival Dish Network (DISH). The earnings multiple is 14.9, but that is less than the industry average and the trailing price-earnings of 20.2. Net cash flow from operations was higher in the first quarter than in the previous few. The consensus recommendation remains to buy DTV shares. The mean price target on the shares is $42.19. The share price was $37.16 at Friday's close; shares have mostly traded between $35 and $38 since April.
Also expected to post earnings gains Thursday are Sotheby's (BID) and Time Warner Cable (TWC). The day's anticipated earnings decliners include Cardinal Health (CAH), CIGNA (CI), Kraft Foods (KFT) and Public Storage (PSA). Crocs (CROX) is forecast to have swung to a profit from last year's loss.
The week closes quietly again as far as earnings reports go, with Washington Post (WPO) the most prominent among the few companies scheduled to report on Friday.