NEW YORK (TheStreet) - There has been a troubling pattern over the last two weeks as earnings disappointments have exceeded positive results. This is decreasing the number of stocks participating in the rally to new highs by the major equity averages. This implies that 2014 will not be a stock pickers market.
Among the 15 companies I profiled on Dec. 17 and Dec. 18, only six traded higher by the end of the week, while nine traded lower. Oracle (ORCL - Get Report) was the biggest winner with a gain of 8.4% followed by Lennar (LEN - Get Report) with a gain of 6.8% and Conagra Foods (CAG) with a gain of 6.5%. There were three companies with bigger losses than the winners' gains; Jabil Circuits (JBL) lost 18.1%, Winnebago (WGO) lost 16.3% and Rite Aid (RAD) lost 12.1%.
Last Tuesdsay's Lennar, Oracle on Deck to Report Earnings covered six companies and three were winners while three were losers including the biggest winner and the biggest loser.
Last Wednesday's Walgreen, CarMax and Nike Earnings Preview covered nine companies and only three were winners while six were losers even as four of the five major averages surged to new all-time or multi-year intra-day highs on Friday.
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Conagra Foods($33.64 vs. $31.48 on Tuesday up 6.5%) beat earnings per share estimates by 7 cents earning 62 cents a share in the premarket on Thursday. The upside into Friday was 3 cents below its 200-day simple moving average at $33.95. The buy rated consumer foods company is 3.1% overvalued with a gain of 11.2% over the last 12 months. My monthly value level is $31.33 with a weekly pivot at $33.82 and semiannual and quarterly risky levels at $34.74 and $35.14.
Darden Restaurants (DRI) ($51.09 vs. $52.33 on Tuesday slipping 2.4%) missed EPS estimates by 5 cents earning 15 cents a share premarket on Thursday The downside was to $49.35 then Friday's close was back above the 200-day SMA at $50.48. The buy rated operator of restaurants such as Red Lobster, Olive Garden, LongHorn Steakhouse and The Capital Grille is considering selling its Red Lobster chain and suspending expansion of its Olive Garden chain is 33.9% overvalued with a gain of 12.4% over the last 12 months. The stock's low was between my annual and monthly value levels at $50.52 and $49.13. My weekly and annual pivots are $52.88 and $53.36 with a quarterly risky level at $55.68.