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
Stocks Under $10 with 50-100% upside potential - 14 days FREE!

Sell Facebook; Hold Amazon; Buy Exxon and Hershey

NEW YORK (TheStreet) -- Let's review four companies that are about to report earnings and how I would trade their stocks.

The four companies are Facebook (FB), Amazon.com (AMZN), Exxon Mobil (XOM) and Hershey (HSY).

Sell Facebook

Facebook had one of the most highly anticipated IPOs of all time and its first earnings report is being preceded by a similar level of excitement.

As much as I have been critical of the company's handling of its IPO, it does deserve some credit for having rebounded slightly from its recent lows of $25. However, I would highly recommend that holders of the stock sell ahead of the company's earnings report, which is scheduled for after the market closes Thursday.

The reason for the concern is simple. Facebook's user growth appears to have peaked in November, and unique visitors to the site actually declined in recent months. Remarkably, rival Google's (GOOG) Google+ service has continued to gain traction recently.

ComScore, which specializes in Internet data and research, recently revealed a drop in Facebook's unique visitors. Although it was not a significant drop, the research firm did suggest it would last longer than anyone anticipated. This should raise a big question mark for investors.

As for the quarter, analysts are expecting earnings per share of 15 cents on revenue of $1.18 billion. Investors will focus on the company's ability to sustain user growth and on how it monetizes mobile users.

The company started its mobile initiative by incorporating sponsored stories into its newsfeeds. Any upside surprise in this area could send shares soaring. However, I think that is highly unlikely in light of the questions about user growth. The smart play here is to sell the stock ahead of the report and wait for shares to return to the $25 level or lower.

1 of 4

Select the service that is right for you!

COMPARE ALL SERVICES
Action Alerts PLUS
Try it NOW

Jim Cramer and Stephanie Link actively manage a real portfolio and reveal their money management tactics while giving advanced notice before every trade.

Product Features:
  • $2.5+ million portfolio
  • Large-cap and dividend focus
  • Intraday trade alerts from Cramer
  • Weekly roundups
TheStreet Quant Ratings
Try it NOW
Only $49.95/yr

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
  • Upgrade/downgrade alerts
Stocks Under $10
Try it NOW

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

Product Features:
  • Model portfolio
  • Stocks trading below $10
  • Intraday trade alerts
  • Weekly roundups
Dividend Stock Advisor
Try it NOW

Jim Cramer's protege, 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
  • Alerts when market news affect the portfolio
  • Bi-weekly updates with exact steps to take - BUY, HOLD, SELL
Real Money Pro
Try it NOW

All of Real Money, plus 15 more of Wall Street's sharpest minds delivering actionable trading ideas, a comprehensive look at the market, and fundamental and technical analysis.

Product Features:
  • Real Money + Doug Kass Plus 15 more Wall Street Pros
  • Intraday commentary & news
  • Ultra-actionable trading ideas
Options Profits
Try it NOW

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

Product Features:
  • 100+ monthly options trading ideas
  • Actionable options commentary & news
  • Real-time trading community
  • Options TV
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!
DOW 16,979.13 +59.54 0.35%
S&P 500 1,986.51 +4.91 0.25%
NASDAQ 4,526.4820 -1.0320 -0.02%

Brokerage Partners

Rates from Bankrate.com

  • Mortgage
  • Credit Cards
  • Auto

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