US Earnings Preview For This Week

Dell (DELL: 14.96 +0.47 +3.24%) will release its results on Thursday, after the close, as second-quarter earnings season nears an end. The technology company is projected to have earned 23 cents per share.

Joining Dell will be fellow S&P 500 members Big Lots (BIG: 24.03 +0.22 +0.92%), Medtronic (MDT: 37.685 -0.115 -0.30%), Novell (NOVL: 4.77 +0.08 +1.71%), Staples (SPLS: 22.67 +0.18 +0.80%) and Tiffany & Co. (TIF: 32.37 +0.27 +0.84%). A total of 76 companies are confirmed to release results.

Given the surprisingly strong July existing home sales report, all eyes will be on Wednesday’s new home sales report. Specifically, economists will want to see that new home sales also rose for a fourth consecutive month.

• Tuesday: August Conference Board consumer confidence, June S&P/Case-Shiller Home Price Index
• Wednesday: July durable goods orders, July new home sales, weekly crude inventories
• Thursday: Preliminary second-quarter GDP, weekly initial jobless claims
• Friday: July personal income and spending, revised August University of Michigan consumer confidence

Atlanta Federal Reserve Bank President Dennis Lockhart will talk to the Chattanooga Area Chamber of Commerce on Wednesday. On Thursday, St. Louis Federal Reserve Bank President James Bullard will speak to MBA students at the University of Arkansas.

The markets are clearly climbing the wall of worry. Though the tailwind from second-quarter earnings has weakened, the markets are still finding upward momentum. At the same time, oil is hitting new highs. It’s difficult to make an argument for fighting the trend, though I do worry about how long this rally can last.

Companies That Could Issue Positive Earnings Surprises

Same-store sales for Dollar Tree, Inc. (DLTR: 45.66 -0.38 -0.83%) surged by 6.8% last month. In response, the majority of the covering brokerage analysts raised their second-quarter profit forecasts, pushing the Zacks Consensus Estimate up 3 cents to 54 cents per share. Given that DLTR has topped expectations for 7 consecutive quarters, another positive surprise could be forthcoming. Dollar Tree is scheduled to report on Wednesday, Aug 26, before the start of trading,

Marvell Technology Group (MRVL: 14.36 +0.13 +0.91%) has topped expectations over the last 4 quarters by an average margin of 3 cents per share. Ahead of the company’s fiscal second-quarter results, 2 of the covering brokerage analysts raised their profit projections. Though the changes did not move the Zacks Consensus Estimate from its current level of 9 cents per share, they did contribute to a more bullish most accurate estimate of 11 cents per share. Marvell Technology is scheduled to report on Thursday, Aug 27, after the close of trading.

Companies That Could Issue Negative Earnings Surprises

During the past few weeks, fiscal fourth-quarter projections on Energy Conversion Devices (ENER: 12.549 +0.189 +1.53%) have been cut. The negative revision caused the Zacks Consensus Estimate to worsen by a penny to a loss of 5 cents per share. The most accurate estimate is even more bearish at a loss of 12 cents per share. Given that ENER missed expectations last quarter, the negative revisions signal that another disappointment could occur. Energy Conversion Devices is scheduled to report on Thursday, Aug 27, before the start of trading.