(By Rich Beiglmeier) When earnings season turns to a trickle, companies that report better or worse than expected earnings standout more than they usually would. Next week, less than 50 companies that iStock follows are scheduled for their quarterly profit check-ups.
Of the 50, we have identified a pair of companies that could stand taller than the rest as their iEstimates are beyond Wall Street's expectations.
Analysts predict Michael Kors Holdings Ltd.
) will earn 16 cents when it reports its fourth quarter earnings before the market open on Tuesday, June 12, 2002. iStock says to expect a topside surprise as the iEstimate for KORS is 19 cents – a 3 cent upside surprise.
In the last month, some analysts have raised the outlooks for KORS's fourth quarter by as much as 42%. Major revisions heading into earnings announcements are usually a strong indication of a possible surprise.
In Michael Kors first and most recent announcement, they topped the Street's view by 122% and the stock lifted off by 23% in the days surrounding earnings.
In recent days, KORS's stock price has been under big pressure, shares have fallen from a high near $50 to less than $37 as we type. There should be strong support at $35 as the stock's price will have closed a February gap up. On solid earning, the high-end, luxury men and women apparel maker could see shares jump to $40 or more on solid results. However, if Kors misses, $30 could come into focus.
Either way, iStock expects a big move one way or the other from the retailer. Options traders might consider straddling KORS shares for the earnings news.
Hurco Companies Inc.
) is VERY thinly traded stock, moving an average of 19.331 share a day. While volume might be small, its stock price has acted like Mighty Mouse for shareholders in six of its last seven quarterly earnings announcements.
In the six plus moves for the computerized machine tools maker, the average earnings gain is 7.5%. On one bad trip, the price trimmed 3.2%. iStock will take a recent 6:1 win rate with a 2:1 reward to risk ratio.
According to Yahoo
, Hurco will earn 50 cents when they report on Monday. Our iEstimate says forget that
; instead look for a number of at least 54 cents.
In a move that gives iStock more confidence that HURC is likely to top the Street's view, insiders have recently engaged in some open market purchases of the stock.
Based on iStock take on HURC's chart, robust earnings and handsome guidance could push Hurco Companies' price towards $27, rewarding insiders and shareholders alike.