BALTIMORE (Stockpickr) -- After weeks of relative quiet, hundreds of companies are slated to release their quarterly performance numbers to the public this week, giving investors ample opportunities to add fundamentally driven positions to their portfolios. And this week, with investor sentiment on the rise following financial reform updates and potentially good news from BP (BP) - Get Report in the Gulf, futures are pointing to a higher open this Monday.
So, with that in mind, we're going to take advantage again this week with 5 more pre-earnings plays.
Investing in companies ahead of earnings can offer investors significant gain potential at the risk of equally impressive losses. But that benefit is still too hard to ignore, so for this week's Rocket Stocks plays, we'll be focusing on companies that are reporting their numbers to Wall Street this week.
For the uninitiated, Rocket Stocks are our weekly list of companies with short-term gain catalysts and longer-term growth potential. In the last 53 weeks, Rocket Stocks have outperformed the S&P 500 by 50.59%.
Here's a look at
While recent years have been less than favorable for legacy airlines, things are finally starting to look up for
. One of the biggest catalysts for Delta right now is the airline's merger. Delta merged with Northwest last year, officially operating under a single FAA certificate, and the company expects to complete its integration by the end of this year. Ultimately, the merger is expected to bring about nearly $2 billion in annual cost savings -- and give the new, larger Delta the ability to compete with lower-cost competitors.
Despite the positive post-merger outlook, there are still several major hurdles Delta will have to clear before shareholders can sleep easy. For starters, Delta will need to get a handle on its balance sheet, which has only recently become attractive following Delta's bankruptcy and the Northwest merger. Likewise, the company's dependence on oil prices is a big concern, especially given the added volatility we've been seeing in commodities.
Still, Delta is a best-in-breed airline stock right now -- and that showed in the earnings numbers management released today. I'm betting that its upside momentum will carry us to gains by Friday.
We're looking at another Atlanta-based business this week too: Soft drink giant
announces its numbers on July 21, and we're jumping on board this week. Coke is the biggest name in the nonalcoholic beverage game, with one of the strongest brands in the world. A hot summer and increasing consumer spending should sway plenty of investors to this beverage play.
When it comes to Coke, the key word is distribution. Coke's distribution chain is one of the biggest and most efficient in the world, with a network that reaches more than 200 countries and helps the firm control more than 3% of the beverages that consumers drink each day. That scope, in turn, has helped Coke create an unstoppable brand over the years: one that Interbrand continues to rate as the most valuable name in the world. That leg up from a marketing standpoint should continue to keep the company's competitors one step behind.
Ultimately, Coke is a substantially different animal from the likes of
, which has worked hard at building a well-diversified business. Coke, on the other hand, has eschewed attempts to step into other businesses (like snack foods and restaurant chains) - frankly, that singularity of focus is something that's paid off well for Coke in the last few decades. Investors should expect it to keep up in 2010.
can't seem to skirt the media these days. The company's latest offering, the iPhone 4, has been a mixed bag for the technology giant: while on one hand the phone was Apple's biggest product launch in history, hype about its antenna problems have pushed the phone's shortcomings into the spotlight. Still, investors are paying too much attention to the story right now, and not enough attention to the numbers.
With the iPad, iPhone 4, and iAds launches all in 2010, Apple is working hard to keep its products up to date while coming up with new and innovative revenue streams. The iAds platform is especially promising, as it offers advertisers a way of showing their wares to around 100 million iOS users in a more integrated way than is currently available through mobile devices. Hopefully, Apple's quarterly numbers on July 20 will give investors a first glimpse at iAds' sales potential.
Last week, at a press conference at Apple's Cupertino, Calif., headquarters, CEO Steve Jobs announced that the company would be giving out a free case to all iPhone 4 owners, explaining that the case should solve the signal attenuation issues that some users are complaining about. During that same conference, he demonstrated that the iPhone 4's signal issues are endemic to smartphones, not just Apple's latest offering. Hopefully, that response will quell investors' anxieties enough to keep their focus on earnings this week.
For more stocks that made this week's cut, including
Chipotle Mexican Grill
, check out the
-- Written by Jonas Elmerraji in Baltimore.
At the time of publication, author had no positions in stocks mentioned.
Jonas Elmerraji is the editor and portfolio manager of the Rhino Stock Report, a free investment advisory that returned 15% in 2008. He is a contributor to numerous financial outlets, including Forbes and Investopedia, and has been featured in Investor's Business Daily, in Consumer's Digest and on MSNBC.com.