Earnings season is in full swing, and huge numbers of companies have already given their latest numbers to investors. The key to making smart investment decisions, with stocks releasing their quarter reports, is to anticipate how they'll do before they announce results, leaving you fully prepared to respond quickly to whatever inevitable surprises arise. That way, you'll be less likely to make an uninformed kneejerk reaction to news that turns out to be exactly the wrong move.

Let's turn to Fossil (NASDAQ:FOSL). The fashion-accessory designer hit hard times last year, but has done a good job of clawing back ground ever since. Let's take an early look at what's been happening with Fossil over the past quarter, and what we're likely to see in its quarterly report next Tuesday.

Stats on Fossil



Analyst EPS Estimate


Change From Year-Ago EPS


Revenue Estimate

$930 million

Change From Year-Ago Revenue


Earnings Beats in Past 4 Quarters


Source: Yahoo Finance.

Will Fossil dress up its quarterly report?
Analysts have been a little bit anxious about Fossil's quarterly results, as they've pulled back on their earnings-per-share estimates by $0.03 over the past quarter. Still, investors are feeling good about the holiday season, and the stock has reflected their enthusiasm, rising by more than 25% since early November.

Coming into the holiday season, investors were extremely concerned about luxury retailers like Fossil. In November, Tiffany (NYSE:TIF) saw margins get squeezed due to high costs and weak demand in Europe and China, despite posting overall revenue growth worldwide. Moreover, after holding up extremely well despite the recessionary environment, both Fossil and Coach (NYSE:TPR) may finally be seeing fatigue from burned-out luxury shoppers who've finally started to hit their spending limits.

But Fossil definitely is working to sustain its edge. As the exclusive licensee of Michael Kors (NYSE:CPRI) watches since 2004, Fossil has benefited greatly from the success of the high-flying apparel retailer, and Kors has also gotten increased exposure from being able to offer an extended line of watches.

In this quarter's report, investors should look closely at Fossil's results, segment by segment, paying special attention to troubled areas like Europe and emerging markets. If the company can gain back some of its lost ground there, then signs of global economic strength could finally let the stock claw its way back to its former highs.

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