Chesapeake, Health Net, Molson Coors, Ralph Lauren, Visteon Set to Report

NEW YORK (TheStreet) -- Here are profiles of five companies that are reporting their quarterly results before the opening bell on Wednesday.

Of the five, health care provider Health Net (HNT) has the biggest year-to-date gain. Helped by the Affordable Care Act, it's up 44%.

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Tied for second place are Molson Coors (TAP) and Visteon (VC), both up 21% year to date.

Chesapeake Energy (CHK) is in fourth place, with a gain of 4.6% year to date.

The only year-to-date loser among the five stocks profiled is Ralph Lauren (RL), which is down 12%.

A common technical reading among the six stocks is that all have declining 12x3x3 weekly slow stochastics even for the three big winners.

Let's take a look at the stock profiles. Two "crunching the numbers" tables follow.

Chesapeake Energy ($26.83) set a 52-week intraday high at $29.92 on July 1, and declined to and held its 200-day simple moving average at $25.95 on both Friday and Monday.

Analysts expect the company to report earnings per share at 44 cents. Chesapeake has a 12-month trailing price-to-earnings ratio of 15 and dividend yield of 1.3%.

The weekly chart is negative with its five-week modified moving average at $27.27 and 200-week simple moving average at $23.18. Semiannual and annual value levels are $21.19 and $19.74 with a weekly pivot at $26.80 and monthly and semiannual risky levels at $27.66 and $27.78, respectively.

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Health Net ($42.64) spiked to a 52-week high at $45.61 on July 24, and declined to its 50-day SMA at $41.53, trading as low as $41 on Friday. The stock is well above its 200-day SMA at $34.53.

Analysts expect the company to report earnings of 56 cents per share. Health Net has a 12-month trailing P/E ratio of 21 and doesn't pay a dividend.

The weekly chart shifts to negative given a close this week below its five-week MMA at $41.85. Quarterly and semiannual value levels are $38.49 and $37.78, respectively, with a monthly pivot at $42.16 and weekly risky level at $44.12.

Ralph Lauren ($156.30) has been below its 200-day SMA at $161.57 since July 10, trading as low as $153.87 on Friday.

Analysts expect the company to report earnings of $1.75 per share. It has a 12-month trailing P/E ratio of 18.7 and dividend yield of 1.2%.

The weekly chart is negative with its five-week MMA at $157.06 and the 200-week SMA at $151.64. A monthly value level is $142.45 with an annual pivot at $154.30 and weekly and annual risky levels at $160.85 and $168.38, respectively.

Molson Coors ($67.90) set an all-time intraday high at $75.55 on June 20, and traded as low as $67 on Friday, which was well below its 50-day SMA at $70.77 and well above its 200-day SMA at $60.02.

Analysts expect the company to report earnings of $1.44 per share. It has 12-month trailing P/E ratio of 16.3 and dividend yield of 2.2%.

The weekly chart is negative with its five-week MMA at $69.75. Semiannual and annual value levels are $62.38 and $60.54, respectively, with a quarterly pivot is $67.88 and monthly and weekly risky levels at $71.00 and $76.99, respectively.

Visteon ($98.81) set an all-time intraday high at $100.79 on July 7, and traded as low as $94.23 on Thursday, compared with its 50-day SMA at $95.65. The stock is well above its 200-day SMA at $85.92.

Analysts expect the company to report earnings of 75 cents per share. It has a 12-month trailing P/E ratio of 22 and doesn't pay a dividend.

The weekly chart is neutral with its five-week MMA at $96.45 and its 200-week SMA down at $62.97. Semiannual value levels are $93.29 and $72.29, with a monthly pivot at $98.60 and weekly and quarterly risky levels at $99.29 and $107.56, respectively.

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Crunching the Numbers with Richard Suttmeier: Moving Averages & Stochastics

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

The 12-month trailing price to earnings ratio

The Dividend Yield

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.

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.

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.

TheStreet Ratings team rates CHESAPEAKE ENERGY CORP as a Buy with a ratings score of B. TheStreet Ratings Team has this to say about their recommendation:

"We rate CHESAPEAKE ENERGY CORP (CHK) a BUY. This is driven by a number of strengths, which we believe should have a greater impact than any weaknesses, and should give investors a better performance opportunity than most stocks we cover. The company's strengths can be seen in multiple areas, such as its robust revenue growth, impressive record of earnings per share growth, compelling growth in net income, attractive valuation levels and good cash flow from operations. We feel these strengths outweigh the fact that the company shows low profit margins."

Highlights from the analysis by TheStreet Ratings Team goes as follows:

  • The revenue growth greatly exceeded the industry average of 1.5%. Since the same quarter one year prior, revenues rose by 47.4%. Growth in the company's revenue appears to have helped boost the earnings per share.
  • CHESAPEAKE ENERGY CORP reported significant earnings per share improvement in the most recent quarter compared to the same quarter a year ago. The company has demonstrated a pattern of positive earnings per share growth over the past year. We feel that this trend should continue. During the past fiscal year, CHESAPEAKE ENERGY CORP turned its bottom line around by earning $0.68 versus -$1.62 in the prior year. This year, the market expects an improvement in earnings ($1.97 versus $0.68).
  • The net income growth from the same quarter one year ago has significantly exceeded that of the S&P 500 and the Oil, Gas & Consumable Fuels industry. The net income increased by 632.8% when compared to the same quarter one year prior, rising from $58.00 million to $425.00 million.
  • Net operating cash flow has increased to $1,291.00 million or 39.71% when compared to the same quarter last year. The firm also exceeded the industry average cash flow growth rate of 18.80%.

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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