Estimize 3/17 Weekly Earnings Preview

by: Leigh Drogen

Featured Earnings Reports This Week

Tuesday: Oracle (NYSE:ORCL)

Earnings are relatively quiet Monday, but things pick up quickly Tuesday with software and cloud services giant Oracle. Cloud services are expected to be a major sector of growth over the next decade and this quarter contributing analysts on the platform are expecting Oracle to deliver a strong a report, beating the Street's expectations on both the top and bottom line.

Tuesday: Adobe (NASDAQ:ADBE)

Analysts from UBS, Jefferies, and Susquehanna all issued bullish price targets on Adobe ahead of the company's FQ1 earnings statement on Tuesday. With that being said, Wall Street is estimating that Adobe's sales will fall nearly 2% compared to FQ1 last year. The Estimize community is expecting Adobe to edge past the Street in EPS but come up $16 million dollars short on revenue. Creative Cloud subscriber sales are expected to continually increase and hit a tipping point sometime in mid 2014 which is when analysts are expecting Adobe to resume year over year revenue growth.

Wednesday: FedEx (NYSE:FDX)

This December was marked by brutal snow storms and extremely cold temperatures which kept shoppers out of retail stores. (NASDAQ:AMZN) got bombarded during the holiday season and rival UPS needed to hire 30,000 more temporary workers than expected to keep up with demand. As a result margins were much thinner and UPS earned $1.25 EPS compared to earlier estimates of $1.43. EPS estimates for FedEx have fallen as well throughout the quarter, but not nearly as sharply as they did for UPS. The Estimize community is forecasting the surge in online holiday shopping to result in a stronger than expected quarter for FedEx.

Thursday: Nike (NYSE:NKE)

Athletic apparel and sports equipment power brand Nike is set to report earnings on Thursday. Nike has now beaten the Wall Street profit consensus 6 quarters in a row and the Estimize community expects them to make it 7 this week. Since its early February low Nike stock has been on a rip returning 11.3%. Competitor Under Armour (NYSE:UA) has been gaining traction on Nike in the U.S. performance apparel industry but Nike still maintains the benefit of dominating international markets.

Friday: Darden Restaurants (NYSE:DRI)

Darden Restaurants controls a handful of U.S. based restaurant chains including, The Olive Garden, Red Lobster, and several other smaller brands. Darden expects lower EPS this quarter has the company will spend money on its plans to spin off Red Lobster. Legal costs and financial advisory services are expected to reduce EPS by about 6 cents. Other concerns for Darden Restaurants include the poor weather and the rise of competition from fast-casual restaurants such as Chipotle Mexican Grill (NYSE:CMG) which posted a breakout quarter at the end of January.