The market hasn't climbed a wall of worry over the past few months. With a respectful nod to Alfred E. Neuman, the market has actually climbed a wall of what me worry. We've skirted past pandemic fears, stress test failures, and a slate of mostly lackluster earnings reports.

The news isn't going to get any better next week, when more blue chips and seemingly recession-proof companies are expected to follow suit with year-over-year bottom-line dips. Let's go over several of the companies that analysts predict will post declines in year-over-year profitability next week. Some of the names may surprise you.


EPS Estimate
for Latest Quarter

Quarter EPS

Hastings Entertainment



E-House (NYSE: EJ)



Hewlett-Packard (NYSE: HPQ)



JA Solar (Nasdaq: JASO)



Deere (NYSE: DE)



Target (NYSE: TGT)



Hormel Foods (NYSE: HRL)



Source: Yahoo! Finance. EPS = earnings per share.

Clearing the table
There will likely be plenty of companies posting lower earnings next week; these are some of the names that really jump out at me.

Hastings is an entertainment retailer that sells everything from CDs and movies to consumer electronics. Wasn't the March liquidation of Circuit City, which covered a lot of the same space, supposed to be a major win for all of the survivors? Circuit City rang up sales of $11.7 billion during its 2008 fiscal year, and that has to go somewhere. Hastings is a small player, but is it really going to earn just half as much as it did a year ago?

E-House is a leading real estate agency in China. Sure, realty may be a touchy subject stateside, but China's economy is still growing. A wealthier citizenry makes it logical to approach E-House as a growth stock. Unfortunately, its bottom line is unlikely to live up to the hype.

Hewlett-Packard had several marvelous quarters after Mark Hurd took over. But have we reached the end of the line? Has Hurd squeezed every last penny he could out of the company's once-bloated operations? If so, HP will have to focus more on growing its business and stop relying on its success in expanding margins from their levels earlier in the decade. Sadly, Wall Street doesn't really see that this quarter.

Back in the day, JA Solar was one of many high-flying solar energy stocks, back when oil was shooting through the roof and consumers were pondering solar panels on their roofs. There is no debate whether solar energy will be an important energy source in the future -- it will be. The question for today's investors is how long it will take for solar energy to become financially feasible.

Deere is another stock that flew through 2007 and early 2008. As the country was concerned over food shortages, Deere's agricultural equipment was seen as a thinking investor's farming play. Well, the company is still refreshingly profitable. It's just not as profitable as it used to be.

Target is a name that may surprise you. Aren't department store shoppers trading down to discounters? If so, Target should be sitting pretty as the "cheap chic" value-minded chain. Well, it isn't. Same-store sales comparisons aren't holding up, and even the discounters find themselves squeezing margins through markdowns to move inventory.

Hormel should be any recession's poster child. The food giant's signature Spam is the canned meat product that can be served up cheaply and in many different ways. Well, even a defensive supermarket staple like Hormel isn't immune from the slowdown, apparently.

Shield your eyes, but do take snapshots
Maybe these companies will debunk the skeptics. HP and Hormel wouldn't have to top expectations by much to post year-over-year gains. HP had beaten Wall Street's guesstimates every quarter under Hurd's reign, before simply meeting analyst projections in the previous quarter.

However, I have to be a realist. Plenty of companies that are supposed to hold up well in this environment -- including discount department store chains, farm tractor giants, and food makers -- are faltering financially.

Then again, the market has already baked in a disappointing quarter for these and other companies. The past two months of rallying stocks have been fun, but stocks are still mostly trading lower today than they were a year ago.

So bring it on, news makers. I'll try not to nibble on my fingernails too hard.

Some other reads to get you through the weekend:

Longtime Fool contributor Rick Munarriz wonders if his contrarian heart will ever be happy. He does not own shares in any of the companies in this story. He is also part of the Rule Breakers newsletter research team, seeking out tomorrow's ultimate growth stocks a day early. The Fool has a disclosure policy.