CSX, GE, Goldman and Intel Earnings Preview

NEW YORK (TheStreet) -- This week is a key for the stock market as we dissect fourth quarter earnings from eight companies including five Dow components and 12 regional banks. In my first post for today, I provided my buy-and-trade' profiles for 12 regional banks including the four 'too big to fail' money center banks. These 20 earnings reports should set the tone for both the pulse of global economic growth and the sustainability of an overvalued overbought stock market.

Last week I profiled nine corporate earnings reports on Jan. 6 in Alcoa, Family Dollar, Micron Signal Earnings Season and on Friday I provided a scorecard in Micron Tech, Constellation Brands Pop on Earnings Reports and six of the nine traded lower on the week. If this pattern continues following this week earnings reports sustainable economic growth will be tested and the stock market could begin a correction.

On Wednesday afternoon we find out whether or not railroad company CSX (CSX) is still carrying full loads in and out of Florida. The Dow transportation average set a new all-time intra-day high on Friday at 7468.05 but the transportation sector is 30.2% overvalued with an underweight rating, as 76.5% of the 170 companies in the sector have sell or strong sell ratings according to www.ValuEngine.com.

On Thursday afternoon Intel (INTC) will disclose how it is growing sales of semiconductors in a world of weakening demand for personal computers. The computer and technology sector is 34.6% overvalued with an overweight rating, as 52.5% of the 1127 companies in the sector have buy or strong buy ratings.

On Friday morning earnings from General Electric (GE) will add a clue on the strength of the global economy. The multi-sector conglomerates sector is 33.5% overvalued with an overweight rating, as 37.3% of the 51 companies in the sector have buy ratings and only 3.9% have sell ratings.

Also on Friday earnings from Schlumberger (SLB) will provide a read on the strength of the global market for oil and gas exploration and production. The oils-energy sector is 14.6% overvalued with an equal-weight rating, as 57.6% of the 540 companies in the sector have hold ratings. Only 1.3% have buy ratings and 29.6% have sell ratings.

American Express (AXP) ($88.55) reports results Thursday and analysts expect earnings of $1.26 per share. Amex traded to an all-time intra-day high at $91.08 on Jan. 2 and is well above its 200-day simple moving average at $76.59. The stock has a hold rating is 32.3% overvalued with a gain of 45.7% over the last 12 months. The weekly chart profile is positive but overbought with the five-week modified moving average at $86.34 and its 200-week SMA at $55.66 in a parabolic pattern. My semiannual value level is $82.46 with a semiannual pivot at $88.58 and monthly and quarterly risky levels at $91.75 and $92.74.

CSX ($28.88) will report results after-hours Wednesday and analysts expect earnings of 42 cents a share. The stock traded to a new all-time intra-day high at $28.94 on Friday. The railroader has a hold rating is 23.2% overvalued with a gain of 40.6% over the last 12 months and is above its 200-day SMA at $25.65. The weekly chart profile is positive but overbought with the five-week MMA at $27.88 and its 200-week SMA at $22.32. My monthly and quarterly value levels are $27.51 and $26.82 with weekly and semiannual risky levels at $29.11, $30.46 and $32.07.

General Electric ($26.96) will report results premarket Friday and analysts expect earnings of 53 cents a share. The stock traded to a multi-year intra-day high at $28.09 on Dec. 31. GE was recently downgraded to hold from buy is 17.9% overvalued with a gain of 27.4% over the last 12 months and is above its 200-day SMA at $24.53. The weekly chart profile turns negative given a close this week below its five-week MMA at $26.97 if its 12x3x3 weekly slow stochastic reading declines from 86.29 to below 80.00. The stock is below semiannual pivots at $27.76 and $27.22 with monthly and quarterly risky levels at $28.10 and $28.95.

Goldman Sachs (GS) ($178.39) will report results premarket on Thursday and analysts expect earnings of $4.13 a share. The new Dow component traded to a multi-year intra-day high at $181.13 on Jan.6. The investment banking firm has a hold rating is 28.6% overvalued with a gain of 29.9% over the last 12 months and is above its 200-day SMA at $160.07. The weekly chart profile is positive but overbought with the five-week MMA at $172.50 and its 200-week SMA at $137.50. My semiannual value levels are $128.94 and $109.41 with monthly, annual and quarterly risky levels at $181.05, $185.25 and $192.37.

Intel ($25.53) will report results after-hours on Thursday and analysts expect earnings of 52 cents a share. The stock traded to a multi-year intra-day high at $26.04 on Dec. 31. The stock was recently upgraded to buy from hold is 21.9% overvalued with a gain of 17.1% over the last 12 months and is above its 200-day SMA at $23.67. The weekly chart profile is positive but overbought with the five-week MMA at $24.94 and its 200-week SMA at $22.83. My annual value levels are $20.78 and $19.44 with monthly and quarterly pivots at $24.26 and $24.40 with semiannual risky levels at $26.33 and $28.95.

Morgan Stanley (MS) ($31.30) will report results premarket on Friday and analysts expect earnings of 44 cents a share. The stock traded to a multi-year intra-day high at $31.93 on Jan. 6. The investment banking and brokerage firm has a hold rating is 37.3% overvalued with a gain of 53.9% over the last 12 months and is above its 200-day SMA at $26.90. The weekly chart profile is positive but overbought with the five-week MMA at $30.78 and its 200-week SMA at $22.59. My quarterly value level is $30.69 with a monthly risky level at $34.07.

Schlumberger ($88.17) will report results premarket Friday and analysts expect earnings of $1.33 cents a share. The stock traded to a multi-year intra-day high at $94.91 on Oct. 21 and has been below its 50-day SMA at $89.56 since Nov. 25. The company has a hold rating is 8.2% overvalued with a gain of 20.4% over the last 12 months and is above its 200-day SMA at $82.32. The weekly chart profile stays negative on a close this week below its five-week MMA at $88.86 with its 200-week SMA at $75.11. My semiannual and quarterly value levels are $85.94 and $85.38 with semiannual, monthly and annual risky levels at $91.36, $93.94 and $100.48.

United Health (UNH) ($74.70) will report quarterly results premarket on Jan. 16 and analysts expect the company to report earnings of $1.40 a share. The stock traded to an all-time intra-day high at $77.32 on Jan. 7. The health care insurance company has a buy rating, is 16.1% overvalued with a gain of 40.7% over the last 12 months and is above its 200-day SMA at $68.72. The weekly chart profile is positive with the five-week MMA at $73.48 and its 200-week SMA at $51.09. The stock is below quarterly and semiannual pivots at $76.43 and $75.19 with semiannual and monthly risky levels at $79.65 and $81.77.

At the time of publication the author held no positions in any of the stocks mentioned.

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This article represents the opinion of a contributor and not necessarily that of TheStreet or its editorial staff.

Richard Suttmeier is the chief market strategist at ValuEngine.com. He has been a professional in the U.S. Capital Markets since 1972, transferring his engineering skills to the trading and investment world.

Suttmeier has an engineering degree from Georgia Tech and a Master of Science degree from Brooklyn Poly. He began his career in the financial services industry in 1972 trading U.S. Treasury securities in the primary dealer community. He became the first long bond trader for Bache in 1978, and formed the Government Bond Department at LF Rothschild in 1981, helping establish that firm as a primary dealer in 1986. This experience gives him the insights to be an expert on monetary policy, which he features in his newsletters, and market commentary.

Suttmeier's industry licenses include, Series 7 and Registered Principal (Series 24). He has been the Chief Market Strategist for ValuEngine.com since 2008 and often appears on financial TV.

Click here for details on Suttmeier's "Buy and Trade" investment strategy.

Richard Suttmeier can be reached at RSuttmeier@Gmail.com

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