Trading Guidelines for Bellwether FedEx, Four Others That Are Reporting

NEW YORK (TheStreet) -- Today I crunch the numbers on the stocks of five companies that are reporting earnings during the next two days, including FedEx (FDX), one of the bellwethers of the U.S. economy.

One stock has a 13% year-to-date gain, one has a 24% year-to-date loss and the others have modest year-to-date losses, continuing the pattern of pre-earnings volatility for stock prices.

The stock-specific volatility makes it important for traders and investors to know the key moving averages, which are a measure of momentum, as well as the value levels at which to buy on weakness and the risky levels at which to sell on strength.

Here are the five profiles. Two "crunching the numbers" tables follow.

Bob Evans (BOBE) ($49.42), down 2.3% year to date. The stock is one of Jim Cramer's top picks. Analysts expect the company to report earnings per share of 42 cents after the closing bell on Tuesday.

The stock set an all-time intraday high at $60.22 on Sept. 24, and trended down to as low as $43.19 on April 17. The stock has been below its 200-day simple moving average at $51.00 since April 3.

The weekly chart is positive with its five-week modified moving average at $47.90 and with its 200-week SMA at $39.75. Annual and monthly value levels are $46.65 and $42.59, respectively, with a semiannual pivot at $49.24 and weekly and quarterly risky levels at $51.37 and $54.41, respectively.

FedEx ($139.45), down 3% year to date. Analysts expect the company to report EPS of $2.36 before the opening bell on Wednesday. Jim Cramer doesn't care for the stock much at current levels, but says the company's conference call can be valuable source for a read on the global economy.

The stock set an all-time intraday high at $144.98 on June 2, and is now between its 50-day and 21-day SMAs at $138.13 and $141.60, respectively, and above its 200-day SMA at $132.59.

The weekly chart shifts to negative given a close this week below its five-week MMA at $139.52. Semiannual and annual value levels are $119.27 and $97.95, respectively, with quarterly and weekly risky levels at $142.30 and $145.09, respectively.

Jabil Circuit (JBL) ($19.76), up 13% year to date. Analysts expect the company to report a loss of 15 cents after the closing bell on Wednesday. The stock had been below its 200-day SMA since Dec, 9, trading as low as $15.30 on Dec. 18. It is now above its 200-day SMA at $19.36.

The weekly chart is positive with its five-week MMA at $18.87 and its 200-week SMA at $19.55. Quarterly and monthly value levels are $18.44 and $16.57, respectively, with a weekly pivot at $19.55 and semiannual risky levels at $20.62 and $25.93.

La-Z-Boy (LZB) ($23.63), down 24% year to date. Analysts expect the company to report EPS of 33 cents after the closing bell on Tuesday. The stock set an all-time intraday high at $31.22 on Jan. 3, and traded as low as $23.24. It has been trading back and forth around its 200-day SMA at $25.70 since April 11.

The weekly chart shifts is negative with its five-week MMA at $24.79. Semiannual and annual value levels are $21.72 and $16.03, respectively, with weekly and semiannual risky levels at $24.89 and $27.80, respectively.

Red Hat (RHT) ($52.14), down 7% year to date. Analysts expect the company to report EPS of 22 cents after the closing bell on Wednesday. The Street's Richard Saintvilus recommends buying the stock ahead of earnings.

The stock traded as high as $61.45 on March 6, and as low as $47.45 on April 28. It's now back above its 200-day SMA at $51.31.

The weekly chart is positive with the stock above its five-week MMA at $51.19 and its 200-week SMA at $48.98. Weekly and annual value levels are $49.54 and $48.28, respectively, with annual and monthly risky levels at $55.80 and $61.79, respectively.

Crunching the Numbers with Richard Suttmeier: Moving Averages & Stochastics

This table provides the technical status for the stocks profiled in today's report.

There are five columns with moving average titles: Five-Week Modified Moving Average, 21-Day Simple Moving Average, 50-Day Simple Moving Average, 200-Day Simple Moving Average and the 200-Week Simple Moving Average.

The column labeled 12x3x3 Weekly Slow Stochastics shows the pattern on each weekly chart with readings from Oversold, Rising, Overbought, Declining or Flat.

Interpretations: Stocks below a moving average are listed in red.

Five-Week Modified Moving Average (MMA) is one of two indicators that define whether or not a weekly chart profile is positive, neutral or negative. The other is the status of the 12x3x3 weekly slow stochastic.

A stock with a positive technical rating is above its five-week MMA with rising or overbought stochastics.

A stock with a negative technical rating is below its five-week MMA with declining or oversold stochastics.

A stock with a neutral technical rating has a profile that is not positive or negative.

The 200-Week Simple Moving Average (SMA) is considered a long-term technical support or resistance and as a "reversion to the mean" over a rolling three to five year horizon.

The 21-Day Simple Moving Average is a short-term technical support or resistance used by many hedge fund traders to adjust positions. A stock above its 21-day SMA will likely move higher over a rolling three to five day horizon and vice versa.

The 50-Day Simple Moving Average is also a technical support or resistance used by many strategists and commentators in financial TV.

The 200-Day Simple Moving Average is another technical support or resistance and I consider this level as a shorter-term "reversion to the mean" over a rolling six- to 12-month horizon.

Crunching the Numbers with Richard Suttmeier: Earnings & Where to Buy & Where to Sell

This table presents the EPS estimates including date and before or after the close, and where to buy on weakness and where to sell on strength.

EPS Date is the day the company reports their quarterly results.

EPS Estimate is the earnings per share estimate from Wall Street analysts.

Value Levels, Pivots and Risky Levels are calculated based upon the last nine weekly closes (W), nine monthly closes (M), nine quarterly closes (Q), nine semiannual closes (S) and nine annual closes (A). I have one column for pivots, which is a magnet for the period shown. The columns to the left of the pivots are first and second value levels. The columns to the right of the pivots are first and second risky levels.

Investors who wish to buy a stock should use a good-until-canceled GTC limit order to buy weakness to a value level. Investors who want to sell a stock should use a GTC limit order to sell strength to a risky level.

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

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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