The Fool Looks Ahead
There's never a dull week on Wall Street. Let's go over some of the news that will shape the week to come.
The new trading week kicks off with Brocade Systems reporting. Shares of the data-storage specialist slipped on Thursday after networking bellwether Cisco stunned the market with downbeat guidance, but is Brocade susceptible to Cisco's weakness, or is this an opportunity for Brocade? We'll find out when Brocade reports on Monday afternoon. Given Cisco's report, the market's likely to put more weight on Brocade's outlook than in its financials for the recently concluded period.
Model N checks in on Tuesday with its latest quarterly results. The provider of revenue management solutions for the high-tech and medical industries was a hot IPO when it went public at $15.50 earlier this year. The market was won over by Model N's ability to get enterprises to more effectively manage their pricing and incentives. However, Model N hasn't delivered on its potential, and it's now another busted IPO. The same analysts who initially gushed over Model N see revenue falling sharply in the new fiscal year that began last month with profits turning into losses.
Green Mountain Coffee Roasters has more than doubled over the past year, but the company behind the Keurig platform has come under fire lately on concerns that private label Keurig K-Cup refills are starting to sip into its business. The good news heading into Wednesday's report is that coffee bean prices have fallen sharply over the past year. Even if Green Mountain has to cut prices to compete aggressively with what is now legal competition -- two key K-Cup patents expired late last year -- margins should still be able to widen.
Wall Street certainly sees it that way. The pros are holding out for a 17% surge in earnings per share despite a mere 2% advance in revenue.
Splunk reports on Thursday. Like Model N, Splunk is a recent debutante that soared out of the gate. Splunk went public last year, but unlike Model N, it has continued hitting new highs as the market gets behind "big data" and how it can improve a company's intelligence. Profitability has been a problem, though. Splunk has posted small deficits in three of the past four quarters, and analysts are banking on another small loss this time aorund. However, they also see a 37% surge in revenue.
That target may prove to be low. Wedbush issued an upbeat not on Splunk on Friday, feeling that Splunk will exceed revenue expectations after performing some channel checks. Wedbush has an "outperform" rating on the stock, but you don't normally see analysts make positive notes this close to an actual report unless they have strong convictions.
The market is typically quiet on Friday, but that just gives gamers more of a reason to make some noise with Microsoft's Xbox One hitting the market.
Microsoft's new console is hitting the market a week after the PS4 -- and at a sticker price that's $100 higher -- but it was the stateside leader of the previous generation of console gaming. Despite some miscues earlier this year in the unveiling process, gamers should come to forgive Microsoft if the machine delivers on its bar-raising ambitions.
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The article The Fool Looks Ahead originally appeared on Fool.com.
Longtime Fool contributor Rick Munarriz owns shares of Green Mountain Coffee Roasters. The Motley Fool recommends Cisco Systems and Green Mountain Coffee Roasters and owns shares of Microsoft. Try any of our Foolish newsletter services free for 30 days. We Fools don't all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.
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