This Day On The Street
Continue to site
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

Alcoa, Family Dollar, Wells Fargo Kick Off Second-Quarter Earnings

NEW YORK (TheStreet) -- Former Dow component Alcoa (AA - Get Report) reports quarterly results after the closing bell Tuesday. On Monday, I wrote "Caterpillar, Intel Have Led the Dow 30 Higher as Earnings Begin"." If Alcoa were still in the Dow Jones Industrial Average, it would be the best performer. Its shares are up 39% year to date.

Note that in the Dow tables presented Monday, the new components did not help the index achieve the 17,000 milestone. Goldman Sachs (GS) is down 4.4% year to date, Nike (NKE) is down fractionally and Visa (V) is down 2.8%.

Today I added a column showing 12-month trailing price-to-earnings ratios to my first "Crunching the Numbers" table, just before the five key moving averages. In general, I believe P/E ratios have become stretched.

Why Apple Shares Remain a Bargain Despite Reaching New Highs

Here's What It's Like Inside Tesla's Massive Factory

Let's take a look at the stock profiles:

Alcoa ($14.74) is up 39% year to date and is above all five moving averages in the first table. Analysts expect Alcoa to report earnings per share of 13 cents after the closing bell Tuesday. The company's 12-month trailing P/E ratio is elevated at 40.5. The stock traded as high as $15.18 on June 26.

The weekly chart is positive but overbought with its five-week modified moving average at $14.34. Semiannual and quarterly value levels are $13.11 and $12.19, respectively, with weekly and monthly risky levels at $15.34 and $15.61, respectively.

Bob Evans Farms (BOBE) ($50.13) is down just 0.9% year to date and is below its 200-day simple moving average at $50.87. Analysts expect the family restaurant chain and provider of food products to report EPS of 42 cents after the closing bell Tuesday. Bob Evans has an elevated P/E at 30.5.

The weekly chart is positive with its five-week MMA $49.27. Annual and monthly value levels are $46.65 and $42.59, respectively, with a semiannual pivot at $49.24, and quarterly and semiannual risky levels at $54.41 and $58.72, respectively.

Family Dollar (FDO) ($64.74) is down 0.4% year to date and is below its 21-day simple moving average at $66.88. Analysts expect the discount retailer to report EPS of 90 cents before the opening bell on July 10. The company has an elevated P/E ratio at 20.5.

The weekly chart is positive with its five-week MMA $63.76. Annual and quarterly value levels are $64.60 and $63.46, respectively, with weekly and semiannual risky levels at $68.45 and $84.89, respectively.

WD-40 (WDFC) ($75.58) is up 1.2% year to date and is above all five key moving averages. Analysts expect the manufacturer of the miracle lubricant to report EPS of 72 cents after the closing bell on Wednesday. The company has an elevated P/E ratio at 28.4.

The weekly chart is positive with its five-week MMA $74.45. Monthly and weekly value levels are $74.78 and $74.15, respectively, with semiannual and quarterly risky levels at $76.42 and $78.17, respectively.

Wells Fargo (WFC) ($53.00) is up 16% year to date and is above all five key moving averages. Analysts expect this "too big to fail" money center bank to report EPS of $1.01 before the opening bell on Friday. The banking giant has a reasonable P/E ratio at 13.1.

The weekly chart is positive but overbought with its five-week MMA $51.77. Semiannual value levels are $50.95 and $43.27 with a quarterly pivot at $53.09 and monthly and weekly risky levels at $54.55 an $54.56, respectively.

Only July 7 I wrote, "Wells Fargo, PNC Financial Lead 24 Banks in the KBW Banking Index", where I noted that all 24 banks seemed to be anticipating better-than-expected earnings based upon the technicals, but I provide some reasons for caution.

1 of 3

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
Only $9.95
14-Days Free
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
SYM TRADE IT LAST %CHG
FDO $79.39 0.05%
AA $9.49 0.00%
AAPL $109.27 0.00%
FB $88.26 0.00%
GOOG $600.70 0.00%

Markets

Chart of I:DJI
DOW 16,102.38 -272.38 -1.66%
S&P 500 1,921.22 -29.91 -1.53%
NASDAQ 4,683.9190 -49.5780 -1.05%

Free Reports

Top Rated Stocks Top Rated Funds Top Rated ETFs