This Week's Key Earnings

It's the heart of earning the earning season, and results are coming fast and furious. It's impossible to cover all the stocks, so I am going to pick out some of the more interesting companies that are expected to report. 

Tuesday
Affordable luxury company Coach's outlook on emerging-market spending will be closely followed, as it will attempt to regain market share from Michael Kors. LED manufacturer Cree will hope to report high growth in LED lighting sales, just as Acuity Brands did a few weeks ago.

Whirlpool will give an update on the market for appliances, as well as its margin-expansion plans. Tool maker Stanley Black and & Decker gave weak results, but it seems to be mainly a problem with a European acquisition in the security market. In other words, it shouldn't spell bad news for Whirlpool.

Numbers from human resource consulting firm Robert Half will be fascinating. The company's earnings have historically correlated with U.S. employment prospects, and conditions are getting steadily better in America. But what will it report on Europe?

Wednesday
It is a big day for aerospace, with Boeing and B/E Aerospace giving earnings. Other bellwethers giving numbers include AT&T and Caterpillar. However, the day belongs to the technology sector.

Citrix Systems (NASDAQ: CTXS  ) has already disappointed the market by pre-announcing third-quarter earnings significantly below its previous guidance. Revenue was light by $24 million, and investors will be keen to find out more when the full release is given. It will probably be less worrying if it came from its application delivery controller NetScaler. Citrix competes with ADC market leader F5 Networks (which also gives results on Wednesday), and some lumpiness NetScaler's growth will probably be forgiven.

However, if the shortfall came from Citrix's core desktop virtualization offering, then it could spell deeper underlying trouble. The key metric to follow is its product and license sales growth, particularly within mobile and desktop. Previously, Citrix management had been calling for an acceleration in mobile and desktop license sales, but are those plans still on track?

Data center provider Equinix's (NASDAQ: EQIX  ) share price has been weak amid fears of slowing growth. Previously, it reduced its forecast for growth in the second half, mentioned some softness in Germany, and admitted to longer sales cycles within its enterprise markets. All of the data center providers have been aggressively expanding capacity, and it's possible that they're starting to lose pricing power due to overcapacity.

The three key metrics to follow are its gross margins, client retention ratio, and its "adjusted discretionary free cash flow." The first two numbers are indicators of its pricing power and competitive positioning, and investors will not want to see them falling. The cited cash-flow measure helps gauge the underlying cash-flow generation in the company and is probably the best way to evaluate a company in a rapid expansionary phase.

The third featured tech stock is Fortinet (NASDAQ: FTNT  ) . It's hard to know what Fortinet will report, and the stock tends to be highly volatile over earnings. However, its guidance for the third quarter looks a bit cautious.

Source: Company accounts; author's estimates.

It is a competitive market, and rivals such as Check Point (which reported expectation beating results this morning) have new products out, while fast-growing newcomer Palo Alto Networks will be determined to expand its installed base. One thing to look out for will be how many larger deals ($500,000 or more) it reports in the quarter. This is a good indication of its ability to further expand outside of its core (small and medium-sized) business market.

Thursday
Colgate-Palmolive and nutrition company Mead Johnson will update the market on the state of the emerging consumer. Other closely followed companies will include Microsoft and energy services company Flowserve. Investors in Zimmer will be cautiously awaiting results after Johnson & Johnson gave a disappointing outlook on pricing in its orthopedic solutions.

Friday
Fridays are relatively quiet, but the big earnings of the day will come from Procter & Gamble. In addition, Sherwin-Williams will update the market on the state of the painting and coating industry.

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