5 Things to Watch This Week: BlackBerry, Netflix, Sirius, Drugs and Games
From a smartphone pioneer debuting the new mobile operating system that might just save it, to the leading video streaming service debuting a high-budget show that it hopes will help it become more than just a conduit for other companies' media, there will be plenty of events that move stock prices in the coming days. Here are five items that we expect will help shape the week ahead on Wall Street.
1. BlackBerry's Last Chance: The buzz has been building for weeks. Research In Motion (RIMM) will introduced its new mobile operating system, and expectations are sky-high for BlackBerry 10.
Shares of Research In Motion have been on a tear since the Jan. 30 media event date was announced, and now it's up to the smartphone pioneer to live up to the hype. After years of growth, the number of BlackBerry subscribers dipped below 80 million a quarter ago, and that's the kind of trend that isn't easy to reverse.
It doesn't help that Android has become the operating system of choice, and that IT departments that used to favor BlackBerry for its enterprise-friendly platform and security features have come around to accepting rival platforms.
There's plenty riding on Wednesday's rollout. Research In Motion may not get another shot if it falls short here.
2. Netflix (NFLX) Has an Ace Up its Sleeves: There was no hotter stock last week than Netflix.
The leading video service saw its stock soar 71 percent after posting better than expected results. There will naturally be plenty of attention on Netflix this week, and it wouldn't be a shock to see the dot-com speedster give back some of those gains in a correction.
However, Netflix does have something else in the works for this week. "House of Cards" -- a 13-episode political drama series starring Kevin Spacey and directed by David Fincher -- will be available exclusively through Netflix starting Feb. 1.
This won't be the first series to air originally through Netflix, but the company is referring to this as a "defining moment" for Internet TV, and rightfully so. Netflix is actually making all 13 episodes available immediately on Friday, instead of trying to build up momentum by dispensing "House of Cards" in weekly installments the way traditional primetime and premium movie channels do. We'll see if this was the right call soon enough.
3. Big Pharma's Drug Bust: A few years ago, investors treated major pharmaceutical companies as all-weather investments. In good times or bad, there was always going to be steady demand for health care and effective treatments.
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However, investing is never quite that simple.
Big drugs go off patent. Stingy insurers scale back coverage. New treatments prove disruptive.
Several of the major drug companies will be dispensing fresh quarterly financials this week, among them Eli Lilly (LLY), Pfizer (PFE), and Merck (MRK). Analysts see all three companies calling in sick. They are all expected to post year-over-year declines in profitability this week.
What do the pharma giants take when they are the ones that are ailing?
4. Sirius XM Won't Take No for an Answer: There are plenty of dormant satellite radio receivers out there, and Sirius XM Radio (SIRI) wants to change that. The media giant is temporarily activating (or reactivating) all of those receivers on Wednesday, giving those that have either cancelled their subscriptions or have never tried the service a fresh perspective.
Sirius XM is making 60 channels of commercial-free music, as well as sports, news, talk, and entertainment available through Feb. 12. The two-week preview is unusually long for the company, but it can't afford to let its momentum slip after closing out 2012 with a record 23.9 million subscribers.
5. EA Gets in the Game: Electronic Arts (EA) is playing a losing game these days.
The video game industry is coming off its third consecutive year of plunging software and hardware sales, and EA hasn't been bucking the trend of malaise.
EA reports on Wednesday, and Wall Street doesn't expect it to be pretty. The pros predict a 22 percent drop in revenue, and they are targeting an even bigger decline in earnings.
EA may have a steady catalog of proven franchises and it has established itself as a major player in casual and social gaming, but in the end it all adds up to less.
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Motley Fool contributor Rick Aristotle Munarriz has no position in any stocks mentioned. The Motley Fool has no position in any of the stocks mentioned.
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