Shares of department store chain Kohl's (KSS) surged Thursday after the company reported better-than-anticipated earnings for its first quarter. Revenue at the retailer fell 1% year-over-year to $4.2 billion as same-store sales declined 1.9%. Earnings per share increased 5% year-over-year to $0.66, exceeding consensus estimates as the share count shrunk. Conversely, free cash flow declined 29% year-over-year to $170 million as the company did not increase its accounts payable as aggressively as it did in the first quarter of the prior year.

We suspect some of the optimism surrounding Kohl's first quarter centers around a slight improvement in gross margins, which increased 50 basis points year-over-year to 36.4%. Management pointed to lower sourcing costs and fewer markdowns as the key drivers, though the firm has yet to see much benefit from improving its inventory mix. Management continues to identify better inventory as a positive driver for gross margin and

As expected, Wal-Mart's (WMT) Q1 fiscal 2014 results were disappointing as its U.S. comparable store sales (CSS) declined by 1.4%. This can be mainly attributed to weak consumer spending during the quarter due to the payroll tax increase and delayed tax refunds. Also, the unusually long winter impacted sales of weather-sensitive products. However, there were some underlying positives for the retailer, including steady growth in the international business and a firm control over operating expenses. Wal-Mart gained share in most of its international markets and grew its operating income in the U.S. by almost 6%. We expect the retailer’s growth to pick up in the future driven by its focus on improving store traffic, e-commerce growth, and controlled international expansion.

Summary of Q1 Performance

Wal-Mart’s U.S. comparable store sales fell by 1.4% primarily due to a 1.8% decline in store traffic. The main reasons were the delay in tax

After a continuous sequential decline in its top line last year, leading semiconductor equipment manufacturer Applied Materials (AMAT) reported a strong Q2 2013, with a 25% q-o-q increase in its sales ($1.97 billion). While the company continued to face challenges in its solar equipment business, its silicon systems group (SSG) and display segment saw increased strength. The higher revenue base combined with lower inventory charges and prudent management of its expenses helped Applied grow its gross margins by almost 4% in the quarter.

Booking a 7% rise in orders, Applied claims to be witnessing healthy demand for semiconductor equipment with a steady increase in utilization at its customers’ factories. After a significant decline in its display business last year, it is seeing rising strength and investment in the market. The company is confident on building momentum towards profitable growth in the subsequent quarters.

We remain optimistic on Applied’s long term

Dell (DELL), which is in the middle of a takeover battle between Carl Ichan and founder Michael Dell, reported its Q1 FY14 results on Thursday. It saw a 2% y-o-y decline in revenues to $14.07 billion as it continues to diversify into end-to-end solutions in order to reduce its dependence on PC sales. Net income also declined by 79% y-o-y to $130 million as weak PC demand and higher investment in research and marketing eroded profits. It reported GAAP earnings per share of 7 cents, down 81% y-o-y, and non-GAAP EPS of 21 cents, down 51%.

The shift in Dell’s focus to end-to-end scalable solutions is evident as its enterprise solutions, services and software revenue increased by 12% y-o-y to $5.5 billion. Despite this increase, end-user computing division revenues, linked to PC sales, declined by 9% to $8.9 billion which indicates a challenging business environment in the personal computing industry.

Quick Take

• In its Q1 fiscal 2014 earnings, Wal-Mart reported a comparable store sales decline of 1.4% in its U.S. operations due to delayed tax refund, prolonged cold and the payroll tax increase.
• However, the international business grew steadily as the retailer gained share in most of its international markets.
• Wal-Mart also maintained firm control over its operating expenses with an efficient supply chain and work assignment projects.
• From a long-term perspective, the retailer’s efforts to attract customers should complement its comparable store sales growth.
• Moreover, given the anticipated growth in the online retail market and Wal-Mart’s initiatives on this front, the online channel will play an important part in its growth.
• Wal-Mart’s controlled expansion strategy for international markets will also aid its comparable store sales growth.

As expected, Wal-Mart‘s (WMT) Q1 fiscal 2014 results were disappointing as its U.S. comparable store sales (CSS) declined by 1.4%. This can be

Intelsat's (I) Q1 results were somewhat better than I expected - modest growth, stable margins, etc. A few thoughts - none of which should be viewed as a recommendation to buy or sell securities or any kind:

A) IPO Was Properly Priced - Intelsat's IPO looks like a success. Priced at $18 below its filing range and with a sharply reduced size, the stock has held its own and even exhibited a respectable IPO "pop." While the IPO valuation represents little upside for Intelsat's private equity investors and I was skeptical there would demand based on the company's risk, it seems the valuation was right for the market.

But we are still a bit confused about who owns the stock. We surveyed the leading industry consultants and none of them received more than a single investor inquiry during the IPO process! Moreover, not a single investor asked a question

By: Brendan Gilmartin, VP Research & Content

Best Buy (BBY) is scheduled to report 1Q 2014 earnings before the opening bell on Tuesday, May 21. The earnings are expected at 7:00 a.m. EST and will be followed with a conference call at 8:00 a.m. Best Buy is expected to garner close scrutiny this period given the recent turnaround efforts and the fact that the shares have more than doubled year-to-date to a recent high near $27.00, a level not seen since mid-2011.

Outliers And Strategy

Best Buy is expected to post a profit of $0.25 per share for the 1Q 2014 period. Forecasts range from $0.14 to $0.32. (Source: Yahoo! Finance)

Revenue for the period is seen dropping 8.3% from the year-ago level to $10.64 bln. Some estimates are running has high as $11.0 bln.

Comparable Store Sales: According to Zack's Institutional Research, Best Buy's

Shares of ViaSat (VSAT) received a nice boost after reporting excellent Q4 FY 2013 numbers, up 17% in mid day trading. Since I first profiled ViaSat in September 2012 when it traded around $38 per, shares are up about 85%.

(click to enlarge)

Business:

ViaSat, Inc. provides fixed and mobile broadband services, and satellite and wireless networks, as well as secure networking systems, products, and services for government and commercial customers worldwide. (source Yahoo! Finance)

It appears like the single most important competitive advantage will be ViaSat's series of high speed satellites, allowing ViaSat to reach users globally, in a scalable way.

Earnings Highlights:

• FY 2013 record revenues of $1.1 billion, up 30% year-over-year.
• FY 2013 record orders of $1.4 billion, up 36% year-over-year.
• FY 2013 adjusted EBITDA grew 10%, to $163 million.

ViaSat-2: The Highest Speed Satellite

Investors also cheered the announcement that ViaSat-2 is now under

For the past several months, I have been working on a model to predict the direction a stock will move after the company reports its quarterly earnings. The underlying assumption is that the level of expectations leading up to the announcement is more important than the actual numbers that the company reports.

If expectations are unusually high going into the announcement, something in the announcement invariably seems to disappoint investors, and the stock price usually falls, regardless of how well the company does compared to analyst expectations (or even whisper numbers).

The disappointment might be based on something other than earnings -- it could be revenues, margins, or guidance, or something entirely different, like an expected dividend boost that didn't come through. In any event, when expectations are through the roof, the chances of some kind of disappointment and a lower stock price are increased dramatically.

Surely, anyone who has

SalesForce.com (CRM) announces earnings after the close on Thursday, May 23, 2013. The company provides enterprise cloud computing solutions to various businesses and industries worldwide. Founded in 1999, it sports a market cap of $24 billion even though it has never showed a profit.

Not showing a profit makes it difficult to calculate a P/E ratio, forcing analysts to look at revenue as an alternative proxy to measure enterprise value. YOY revenue growth has been high, about 32%, which gives some justification for its forward P/E of 74. This compares to its competitors' forward multiples of 12 for Oracle (ORCL) and 20.5 for SAP (SAP). CRM seems pretty pricey, even if the company turns the corner to profitability.

Here are the results after the earnings announcement for the past four quarters, with the stock price change from the close on the day before the announcement until the closing price

As warned back after the massive IPO gains, ExOne Company (XONE) was set up for a potentially rocky public market experience. The company only reported $28.7 million in revenue for all of 2012 and had a limited experience of actually selling 3D printers.

The 3D industrial printer company focuses on manufacturing and selling 3D printing machines in fact didn't even sell a machine in Q1 of 2012.

The stock surged to $49 prior to the earnings report after initially pricing the offering at $18 providing those initial investors with over a 170% gain in roughly four months. The Q113 numbers though were shockingly disappointing as the company yet again missed estimates blaming European weakness.

Q1 2013 Highlights

The company provided the following highlights for Q1 2013:

• Revenue increased by $5.2M to $7.9M; five machines sold in the quarter.
• 3D printed parts and material revenue increased to $3.7M from

Abercrombie & Fitch (ANF) announces earnings on Friday, May 24, 2013 before the market opens. This is a little scary for option traders because the weekly options will be in play for only one day before they expire.

ANF describes itself as a specialty retailer of casual apparel for men, women, and kids (although I could never figure out how you can specialize in all three at the same time). Market cap $4.24B and most recent closing price $54.24. Trailing P/E 19 which is slightly higher than competitors American Eagle Outfitters (AEO) and The Gap (GPS) who have a P/E of 17.

Institutional investors have sold nearly 34 million shares over the last quarter (source: Yahoo) which amounts to about 44% of the outstanding shares. While this is a disquieting statistic, the company pays a well-protected 1.5% dividend (payout ratio only 25%) which helps protect against a huge drop

Unlike other Chinese Internet portals, SINA Corporation (SINA) can demonstrate that its success is not only represented by excellent user engagement metrics, but also by its stock price performance. It's up 9.6% this month, quite below Nasdaq 100 but well above Baidu (BIDU), Renren (RENN), and Youku.com (YOKU), whose performance in the past year was actually negative.

There is something special about SINA. Unlike Renren, its monthly average users database looks very attractive not only in the long run, but also in the short term as there are fewer students and more middle-class urban residents employed. But it also owns Weibo, China's version of Twitter, which is on its way to being used by almost everybody in China who has an Internet connection -- from students to housewives. Unlike Youku.com, it is not that into the business of online video platforms, which is already very competitive (Renren's 56.com and Baidu's

Electronics retailing giant Best Buy (BBY) will announce its Q1 results on May 20. We expect the company to report better year-over-year revenues largely due to its price matching policy. However, margins could come in lower due to aggressive pricing and its net profit may not see much upside.

Best Buy was in the news this quarter for three main reasons: the commencement of its price matching policy, setting up its Samsung-branded boutiques in its stores and the decision to exit Europe by selling off its stake in its joint venture with Carphone Warehouse.

CEO Hubert Joly seems to have taken some steps to arrest the slide in Best Buy’s stock, and these efforts are yielding results as evident from the stock performance over the last three months. The earnings results will clarify whether the price movement is sentiment-driven or backed by improved business prospects.

Exiting Europe

Last month, Best

Quick Take

• Limited Brands is expected to release its Q1 fiscal 2013 earnings on May 22.
• According to a recent press release, the company will report a moderate 3% increase in overall comparable store sales.
• Victoria’s Secret started the quarter strongly, but its growth slowed subsequently due to lower demand for apparel products, aggressive promotions and a weak response to new product launches.
• At Bath & Body Works, the growth remained slow but steady due to the mixed impact of lower store traffic and strength in core product categories.

Limited Brands (LTD), the parent company of Victoria’s Secret and Bath & Body Works, is expected to release its Q1 fiscal 2013 earnings on May 22. According to a recent press release, the company will report overall comparable store sales growth of 3% with similar growth across its main brands. The retailer will also report lower margins

Lowe's (LOW) reports its fiscal q1 '14 earnings before the bell on Wednesday, May 22, 2013, a day after Home Depot (HD). Analyst consensus, per ThomsonReuters is looking for $0.51 in earnings per share (EPS) on $13.45 billion in revenues for expected year-over-year growth of 16% and 2%, respectively.

Quarterly comps are expected between 2%-3%.

You cannot talk about LOW without also talking about Home Depot , since the two competitors are like dueling banjos in the oligopolistic, do-it-yourself home improvement business, and in terms of competitive strategy, they've "yinged and yanged" their way through the last 13 years, i.e., when HD flags, LOW seems to do better, and vice versa. (Read our HD preview here, since HD reports its fiscal q1 '14 the day prior to LOW.

To give readers some background or history, HD and LOW had many tailwinds in the housing market of the late 1990s