This Day On The Street
Continue to site right-arrow
ADVERTISEMENT
This account is pending registration confirmation. Please click on the link within the confirmation email previously sent you to complete registration.
Need a new registration confirmation email? Click here
Cramer's Action Alerts PLUS - See his portfolio and get alerts BEFORE every trade. Learn more NOW!

Top 6 Earnings Releases to Watch Next Week

NEW YORK ( TheStreet) -- The Federal Reserve refilled the punchbowl and as long as you haven't made any mistakes in your financial planning (trying to build a savings or avoiding debt), the party is still going strong.

Next week we find out how a major housing market company is faring in a world awash in easy cheap money. We'll also see earnings for several technology companies, including the maker of BlackBerry.

RHT Chart RHT data by YCharts

Red Hat (RHT - Get Report)

Background: Red Hat is a leading developer and provider of open source software and services, including the Red Hat Linux operating system. Red Hat trades an average of two million shares per day with a market cap of $11 billion.

52-Week Range: $37.85 - $62.75

Book Value: $7.34

Price To Book: 7.99

Red Hat is forecast to report slightly lower second-quarter earnings after the market closes on Monday. The consensus estimate is currently 21 cents a share compared with 22 cents during the equivalent quarter last year. Technically, the difference is 4.5%, but I don't consider percentage changes meaningful when the gross amount is 1 cent.

Seventeen out of 24 analysts rate Red Hat a buy or strong buy. The company has six holds, and one sell rating.

Twelve out of 24 analysts now rate Red Hat a strong buy, up from 11 analysts a month ago. The number of analysts rating Red Hat a strong buy during the last three months has moved up and down. The average analyst target price for Red Hat is $60.53.

It's never a bad idea to be within good company, and Jim Cramer believes Red Hat is cheap as of a week ago. I concur and wrote about it in this article. .

After the company missed guidance in the last earnings report, I wrote that I believed the guidance wasn't that bad. As it turns out, I was not only correct but Red Hat shares only took about a month before they were trading above the earnings announcement.

After a brief dip below the 200-day moving average, the trend is once again bullish. Based on technical analysis, Red Hat is in an upward trend, and there is no indication the trend is about to end.

Not all of the news is swell for investors, however.

Red Hat has blistering earnings multiple ratios that leave the open source company like an elephant riding a bike. It better not slow down too much or there will be hell to pay. The trailing 12-month price-to-earnings ratio is 70. Looking ahead, the ratio does not demonstrate a great deal of improvement. The mean fiscal year estimate price-to-earnings ratio is 67, if Red Hat comes in on target with estimated earnings of 87 cents per share this year.

I am consistently reluctant in advocating the bullish case for stocks above a multiple of 20. Red Hat does pull a rabbit out of the fedora and receives my aberrant bullish opinion in front of earnings. I have faith Red Hat beats this quarter.

Weinstein estimate: Red Hat beats and stock reacts positively. Currently, the short interest based on the float is small and not a big concern. Short interest is 3.1%.

1 of 6

Check Out Our Best Services for Investors

Action Alerts PLUS

Portfolio Manager Jim Cramer and Director of Research Jack Mohr reveal their investment tactics while giving advanced notice before every trade.

Product Features:
  • $2.5+ million portfolio
  • Large-cap and dividend focus
  • Intraday trade alerts from Cramer
Quant Ratings

Access the tool that DOMINATES the Russell 2000 and the S&P 500.

Product Features:
  • Buy, hold, or sell recommendations for over 4,300 stocks
  • Unlimited research reports on your favorite stocks
  • A custom stock screener
Stocks Under $10

David Peltier uncovers low dollar stocks with serious upside potential that are flying under Wall Street's radar.

Product Features:
  • Model portfolio
  • Stocks trading below $10
  • Intraday trade alerts
14-Days Free
Try it NOW
Only $9.95
Try it NOW
14-Days Free
Try it NOW

Check Out Our Best Services for Investors

Dividend Stock Advisor

David Peltier identifies the best of breed dividend stocks that will pay a reliable AND significant income stream.

Product Features:
  • Diversified model portfolio of dividend stocks
  • Updates with exact steps to take - BUY, HOLD, SELL
Trifecta Stocks

Every recommendation goes through 3 layers of intense scrutiny—quantitative, fundamental and technical analysis—to maximize profit potential and minimize risk.

Product Features:
  • Model Portfolio
  • Intra Day Trade alerts
  • Access to Quant Ratings
Options Profits

Our options trading pros provide over 100 monthly option trading ideas and strategies to help you become a well-seasoned trader.

Product Features:
  • Actionable options commentary and news
  • Real-time trading community
Try it NOW
Try it NOW
Try it NOW
To begin commenting right away, you can log in below using your Disqus, Facebook, Twitter, OpenID or Yahoo login credentials. Alternatively, you can post a comment as a "guest" just by entering an email address. Your use of the commenting tool is subject to multiple terms of service/use and privacy policies - see here for more details.
Submit an article to us!
SYM TRADE IT LAST %CHG
WAG $81.65 2.05%
DFS $59.31 0.00%
LEN $50.05 0.00%
MU $29.26 0.00%
RHT $67.19 0.00%

Markets

DOW 18,096.90 -106.47 -0.58%
S&P 500 2,098.53 -9.25 -0.44%
NASDAQ 4,967.1410 -12.76 -0.26%

Partners Compare Online Brokers

Free Reports

Free Newsletters from TheStreet

My Subscriptions:

After the Bell

Before the Bell

Booyah! Newsletter

Midday Bell

TheStreet Top 10 Stories

Winners & Losers

Register for Newsletters
Top Rated Stocks Top Rated Funds Top Rated ETFs