Schaeffer's Daily Market Blog Features: American Eagle Outfitters, Wal-Mart Stores, Interpublic Group of Companies, Staples, and Home Depot.
Don't forget that many of our observations are available as audio presentations that you can hear on your computer or download from Apple's iTunes Music Store to play on a portable device such as an iPod. To see the full menu of podcasts, please visit http://www.schaeffersresearch.com/commentary/podcasts/.
On Wednesday, tune in to our 1,000th podcast, which will feature an interview with our company founder, Bernie Schaeffer.
10:21 AM American Eagle Soars on Earnings
Before the open this morning, American Eagle Outfitters (NASDAQ:AEOS) announced that third-quarter income rose to $100.9 million, or 66 cents per share, as sales increased to $696.3 million. Same-store sales during the quarter rose 13 percent. Analysts had predicted earnings of 65 cents per share on revenue of $690.9 million. The company set its fourth-quarter earnings view at 94-96 cents per share, ahead of the consensus estimate of 91 cents. What's more, the firm announced that its board declared a three-for-two common stock split. The stock split is payable December 28 to shareholders of record November 24.
Technically speaking, the equity gapped higher on the open to tag a new all-time high of $48.47. The shares have since begun to pull back to support at the 47 level, a region of former staunch resistance for the security. Heading into the report, options players were skeptical of the firm. The stock's Schaeffer's put/call open interest ratio (SOIR) has climbed to 1.54, which is higher than all but 18 percent of the readings taken during the past 52 weeks.
10:26 AM Wal-Mart Jumps on Earnings
Wal-Mart Stores (NYSE:WMT) boasted third-quarter earnings of $2.6 billion, or 63 cents per share. Stripping out a favorable tax ruling, profit rose 7.1 percent to $2.9 billion, or 62 cents per share. Sales for the three-month period climbed 12 percent to $84.5 billion. Analysts had forecast earnings of 59 cents per share on revenue of $84.48 billion. The company expects fourth-quarter earnings between 88 cents and 92 cents per share.
The shares gapped higher on the news and are currently up 2.7 percent. This rally has carried the security above its declining 10-day moving average, but the stock has pulled back to rest on this trendline. The equity is still facing overhead resistance at its 10-week moving average. In options activity, the stock has inched above heavy call open interest at the November 47.50 call (more than 21,400 contracts), but is still below peak call open interest at the 50 strike (nearly 26,000 contracts).
11:26 AM NYSE & NASDAQ New Highs/New Lows With Equity Scorecard
Each day, our Trader's Blog features tables with stocks achieving new annual highs or lows while sporting an "extreme" Schaeffer's Equity Scorecard rating. Today's tables include Interpublic Group of Companies (NYSE:IPG) and its score of 9.0 out of 10 and Walter Industries (WLT) and its score of 2.0 out of 10.
11:38 AM Save Money on Gasoline
We have a new video series at our Audio and Video center at http://www.schaeffersresearch.com/commentary/podcasts/. It's called Fuel Report.
Pooling all our resources, which include the latest crude oil prices, oil inventory reports, geopolitical news, and the overall state of the economy, we aim to answer one simple question: should we fill up the gas tank today, or wait? That "I just saved 10 cents a gallon" feeling always makes my day, and it adds up over the course of a year.
11:56 AM Staples Attracts Options Buyers
Staples (NASDAQ:SPLS) is another retailing name to take its turn in the earnings confessional today. The office-supplies concern said third-quarter net income rose to $289.9 million, or 39 cents per share, from 30 cents in the year-ago period. Excluding items, SPLS would have earned 36 cents per share. Sales rose to $4.76 billion as same-store sales edged four percent higher. Analysts were expecting per-share results of 36 cents on $4.69 billion in revenue.
The stock has dropped more than two percent today, gapping below its 10-day and 20-day moving averages. Today's news has sparked interest among the speculative crowd. The SPLS January 25 call (PLQ AE) is currently the most-active call on the CBOE, with more than 11,000 contracts changing hands. Heading into today's session, this at-the-money position was home to about 2,600 contracts, indicating that much of today's volume is likely to translate as new open interest.
12:03 AM Home Depot Disappoints
This morning, Home Depot (NYSE:HD) announced poorer-than-expected third-quarter earnings. The home-improvement company raked in 73 cents per share during the quarter while tallying quarterly sales of $23.09 billion. The consensus estimate for quarterly earnings stood at 75 cents per share on net sales of $23.4 billion. HD's chairman, president, and chief executive Bob Nardelli noted that "sales performance was softer than we anticipated, but I believe we are making the right decisions to strengthen our core retail business."
Currently, HD shares have slipped nearly one percent following the disappointing news. Moreover, the stock still faces resistance at its 10-week and 10-month moving averages. The 10-week trendline has been a major barrier in the stock's struggles throughout 2006. A recent bearish crossover completed by HD's 10-month moving average is also a foreboding technical development.
For more information on these stocks or any stock in your portfolio, feel free to visit our Schaeffer's Equity Scorecard feature. Click here to read all of today's Market Blog: http://www.schaeffersresearch.com/redirect.aspx?CODE=PROB13C&PAGE=1.
Take advantage of the timely Schaeffer commentaries by signing up for their free e-newsletters -- Opening View, Market Recap and Monday Morning Outlook. Click here to have the Schaeffer's commentaries delivered to you free via email every day and get entered to win an IPod Nano. http://www.schaeffersresearch.com/redirect.aspx?CODE=PROB13M&PAGE=1.
About Schaeffer's Investment Research (www.SchaeffersResearch.com)
Schaeffer's Investment Research, founded by Bernie Schaeffer in 1981, is a financial information and trading resources company. It publishes Bernie Schaeffer's Option Advisor, the nation's leading options subscription newsletter. The firm's contrarian approach focuses on stocks with technical and fundamental trends that run counter to investor expectations. The firm's website, http://www.SchaeffersResearch.com , is recognized as one of the leading information sources for stock and options traders and was cited as the top options website by both Forbes and Barron's. Click here for more details about Schaeffer's trading methodology: http://www.SchaeffersResearch.com/method .
|Printer friendly Cite/link Email Feedback|
|Article Type:||Industry overview|
|Date:||Nov 14, 2006|
|Previous Article:||Checkpoint Systems Acquires ADS Worldwide.|
|Next Article:||CreditRiskMonitor Reports 3rd Quarter Growth.|