7 Reasons to Worry About Next Week

It's the time of the year to be thankful, but that's hard to do when the European debt crisis isn't getting any better and the MF Global fiasco is getting uglier.

There's also more uncertainty from companies that aren't necessarily insolvent. Just wait until you hear what corporate America has to say next week.

There are still plenty of companies posting lower earnings than they did a year ago. Let's go over a few of the names that are expected to go the wrong way on the bottom line next week.

Company
Latest Quarter EPS (Estimated)
Year-Ago Quarter EPS
My Watchlist
TiVo (Nasdaq: TIVO  ) ($0.23) ($0.18) Add
Suntech Power (NYSE: STP  ) ($0.26) $0.18 Add
JA Solar (Nasdaq: JASO  ) $0.00 $0.47 Add
Yingli Green Energy (NYSE: YGE  ) $0.02 $0.49 Add
Hewlett-Packard (NYSE: HPQ  ) $1.13 $1.33 Add
Ship Finance (NYSE: SFL  ) $0.43 $0.46 Add
Brocade (Nasdaq: BRCD  ) $0.10 $0.14 Add

Source: Thomson Reuters.

Clearing the table
Let's start at the top with TiVo.

The patent-rich company that invented the digital video recorder (DVR) is probably better off hitting the rewind button to remember its former days of glory. Losses have been mountainous lately, and subscribers have been declining.

Is it TiVo's fault or have consumers just evolved into stream-happy masses that are no longer interested in recording shows or zapping through commercials because they know that they can catch episodes they miss on demand later?

Suntech Power, JA Solar, and Yingli are three of the half-dozen solar energy stocks reporting next week. Guess what? They are all expected to post deteriorating bottom-line results this time around.

Few will argue against the long-term potential of solar. Photovoltaic cells will one day become a household term. However, green energy is a hard sell when some of solar power's biggest clients in Europe are struggling through the growing sovereign debt nightmare.

HP now has Meg Whitman at the helm, but a new problem-solver doesn't mean that the problems have gone away. HP recently decided to keep its PC business, but now it has to decide what it wants to do with its Palm webOS division after the first -- and perhaps last -- webOS tablet crashed and burned.

Ship Finance has an impressive fleet of oil tankers, dry bulk carriers, and deepwater drilling gear that it utilizes to serve the shipping and offshore drilling industries. Commodity prices may be heading higher -- potentially jacking up demand for its services --but it's just not materializing on the bottom line.

Finally we have Brocade. Selling networking equipment isn't easy in this hazy economy as companies scale back their IT expenditures.

The good news for Brocade is that the company has landed ahead of Wall Street's expectations in each of its four previous quarters. In other words, that points to Brocade earning more than the $0.10 a share that pros are targeting. It probably won't be enough to surpass the $0.14 a share it rang up a year earlier, but it's at least one reason to be hopeful.

Why the long face, short-seller?
These companies have seen better days. The market has rewarded many of these stocks with reasonable gains over the past year, but they still haven't earned those upticks.

The good news here is that Wall Street already expects these companies to deliver shrinking bottom lines. In other words, the bad news is already baked into the shares.

The more I think about it, the less worried I become.

How do you think these stocks will fare when they report next week? Share your thoughts in the comments box below.

Longtime Fool contributor Rick Munarriz calls them as he sees them. He does not own shares in any of the stocks in this story, except for HP. Rick is also part of the Rule Breakers newsletter research team, seeking out tomorrow's ultimate growth stocks a day early.

Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.


Read/Post Comments (4) | Recommend This Article (3)

Comments from our Foolish Readers

Help us keep this a respectfully Foolish area! This is a place for our readers to discuss, debate, and learn more about the Foolish investing topic you read about above. Help us keep it clean and safe. If you believe a comment is abusive or otherwise violates our Fool's Rules, please report it via the Report this Comment Report this Comment icon found on every comment.

  • Report this Comment On November 18, 2011, at 11:10 AM, sameeh57 wrote:

    I do not agree with you on your analysis for TIVO.

    The company expanded its market and have joint ventures with many companies in the US and UK as well as Spain plus Asia, which should all add to the value of the stock. I dont think they will repot bad eps next week!!!

  • Report this Comment On November 18, 2011, at 11:42 AM, Hoxsie454 wrote:

    I respect your opinions very much, but I think in TiVo's case, we should think ahead three months to the earnings report due February 2012. In the UK, Virgin Media reports TiVo hook ups increasing 400%. ONO, Spain's largest cable provider is actively hooking TiVo in Barcelona's and Madrid's 10 million population urban areas. This quarter is shaping up to be a block-buster!

    Disclaimer: I own TiVo shares.

  • Report this Comment On November 19, 2011, at 8:25 AM, DivingDan wrote:

    Someone once said to the effect if you see ten things to worry about, ignore them. 9 of them will never happen.

    None of this worries me... it's mostly short term gyrations and using fear for headlines is sensationalism... not a Foolish tenet.

  • Report this Comment On November 22, 2011, at 1:12 AM, bankruptcom wrote:

    Another crazy company that does not make any money and probably never will.

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