Dow Components to Watch This Coming Week

After last week, when eight of the Dow Jones Industrial Average's (DJINDICES: ^DJI  ) 30 components reported earnings, this week may seem slow, with only four companies releasing their second-quarter financials. Before they do, let's take a few minutes to review what Wall Street is expecting from each of them.

Monday will be a busy day for earnings releases, though not from any of the Dow's components. Things will heat up for the index on Tuesday, with Pfizer (NYSE: PFE  ) and Merck (NYSE: MRK  ) both set to report earnings before the opening bell on Tuesday.

Wall Street expects Pfizer to report earnings per share at $0.55 on revenue of $13.02 billion. The EPS number is based on 15 analysts' estimates, with the high end at $0.61 and the low end at $0.52. One year ago, Pfizer posted EPS of $0.62 while analysts had expected $0.54. Pfizer posted revenue of $15.06 billion in Q2 2012, so with this quarter's estimate, analysts are expecting a sales decline of 13.5%.  

As for Merck, the Street expects revenue of $11.22 billion and an average analyst EPS target of $0.83. The high-end estimate for EPS is $0.89, and the low end is $0.80. Last year, Merck's $1.05 EPS beat estimates of $1.01, while sales came in at $12.31 billion. Wall Street is expecting the company to post an 8.9% sales decline this year over last.  

Both Pfizer and Merck have been hit hard in recent months as the companies deal with the patent cliff and their high-performing drugs lose market share in the face of generic-drug competition. If either company can beat expectations, shares should respond upward nicely, but if they do even worse than expected results, we may just see the bottom fall out.

ExxonMobil (NYSE: XOM  ) reports on Thursday, while fellow energy stock Chevron (NYSE: CVX  ) pulls in on Friday. For Exxon, the Street wants to see EPS of $1.90 on revenue of $105.54 billion. A year ago, Exxon posted EPS of $1.80 and sales of $127.36 billion. Earnings are thus set to rise, and that's what really matters. The EPS estimate of $1.90 is an average of 21 analysts' opinions, with the high end at $2.05 per share and the low end coming in at $1.63. The expected 17.1% year-over-year revenue drop for Q2 isn't a great sign, and it could pose a big problem if Exxon misses expectations.  

As for Chevron, the outlook is for revenue of $56.01 billion, 10.5% below the same quarter in 2012. EPS are also forecast to be down to $2.96, from $3.56 a year ago. Last year analysts expected EPS of $3.24, and if a big surprise was to come again this year, the stock could respond very favorably -- but don't hold your breath.  

While both companies are benefiting from higher oil prices and the large amount of oil and natural gas to be extracted here in the U.S., getting the fuel out of the ground and transporting it is becoming more difficult and costly for the companies involved. Investors should be watching costs, especially to see how fast they riss from a year ago, before making any buy or sell decisions here.

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