NEW YORK (TheStreet) -- This earnings season has seen lots of volatility for stocks following quarterly reports. This is why investors need to understand the risk/reward for a stock, including its year-to-date return before its earnings report, and what the key trading levels are.
Today we'll look at how to trade shares of the following companies, which plan to report earnings after the closing bell Monday: Netflix (NFLX), Chipotle (CMG), Texas Instruments (TXN), Zions Bancorp (ZION) and Packaging Corp. (PKG).
The best year-to-date performer is Netflix, which is up 21%. There is a second-place tie between Chipotle and semiconductor giant Texas Instruments, both of which are up 11%.
The PHLX Semiconductor Index, also known as the SOX, is up 20% on the year, so Texas Instruments is a laggard.
The BKW Banking Index is a year-to-date laggard and is up just 2.2%, but component Zions down 3.9%.
Packaging Corp., producer of containerboard and corrugated packaging products, is up 6.9% year to date, and its earnings report and guidance should be considered an indicator for broader economic growth.
Let's take a look at the stock profiles. Two "Crunching the Numbers" tables follow.
Chipotle ($592.42) set an all-time intraday high at $622.90 on March 21 then declined to as low as $472.41 on April 28 as investors temporarily became concerned about elevated price-to-earnings ratios. The stock was below its 200-day simple moving average as a short-term "reversion to the mean" between April 28 and May 21. This moving average is now at $538.06.
Analysts expect Chipotle to report earnings per share of $3.05. The stock's price-to-earnings ratio, based on trailing 12-month earnings, remains elevated at 54. Chipotle is not a dividend stock.