CORRECTED-What to Watch in the Week Ahead and on Monday, Feb. 9
(Corrects entry on Inovalon Holdings to specify its major shareholders as Meritas Group Inc and Meritas Holdings LLC) Week Ahead The last week of earnings will dominate activity for the equity market, which after some weakness in January now sits a stone's throw from an all-time high. The strong jobs report figures could continue to boost expectations for higher rates, though long yields could still find pressure from overseas investors looking for yield. The euro, too, is likely to continue to weaken against the dollar, as investors maintain worries about the consequence of the Greece-EMU standoff. While weak spending by telecom service providers such as Verizon and AT&T is likely to weigh on Cisco Systems Inc's results, the company is set to benefit from strong growth in the data center and security businesses. The network equipment maker is expected to report second-quarter revenue and profit above analysts' average estimate on Wednesday, according to Thomson Reuters Starmine data. Investors will be also be expecting strong growth from the switching segment. Insurance company American International Group will release fourth-quarter results on Thursday and analysts expect earnings of $1.05 per share. This will be the first full quarter under CEO Peter Hancock, who took over from Bob Benmosche in September. On Wednesday, Time Warner Inc is expected to report lower-than-estimated fourth-quarter profit for the first time in eight quarters. The company had been engaged in a dispute with Dish, whereby Dish blacked out several of Turner's networks channels, including CNN and the Cartoon Network, affecting about 14 million of turner's subscribers. However, the recently announced HBO standalone streaming is expected to drive revenues up for the company in 2015 and 2016. Separately, CBS Corp is expected to report higher earnings for the fourth quarter on Thursday as the company continues to diversify its revenue beyond advertising. Analysts expect the owner of the most-watched U.S. broadcast network to report earnings-per-share of 76 cents, compared with 69 cents a year earlier. A light data calendar next week, with January retail sales and February consumer sentiment the only major reports due for release. But secondary reports on wholesale and business inventories could shed more light on the extent of the economic growth slowdown in the fourth quarter and prospects for the first quarter. The Commerce Department is expected to report on Tuesday that wholesale inventories edged up 0.1 percent in December after rising 0.9 percent in November. On Thursday, the Commerce Department is expected to report that retail sales fell 0.5 percent in January, largely reflecting lower gasoline prices, after dropping 0.9 percent in December. Commerce Department data on Thursday is likely to show business inventories rose 0.2 percent in December after a similar gain in November. On Friday, the University of Michigan will likely report that its consumer sentiment index held steady at a multi-year high of 98.1 in early February. Labor Department data on Friday is expected to show import prices tumbled 3.2 percent in January after falling 2.5 percent in December. Planned appearances this week by the policy hawk chiefs of the Dallas and Richmond Feds look unlikely to deliver much fresh color on U.S. monetary policy, but investors can expect an earful on politics from Fed Governor Jerome Powell, who is set on Monday to stake out his thinking on the range of legislative proposals targeted at reining in the Fed's powers, including Rand Paul's Audit the Fed bill. Billionaire businessman Carlos Slim's flagship company, America Movil will report fourth-quarter results on Tuesday. The phone company has been struggling to increase revenue as it faces tougher regulation in its biggest markets, Mexico and Brazil. UBS Group AG, a Switzerland-based bank engaged in investment management reports fourth-quarter and full-year results on Tuesday. Chief Executive Sergio Ermotti will address journalists. On Thursday, Swiss bank Credit Suisse Group AG reports earnings for the fourth quarter and year, during which it became the largest bank in decades to plead guilty to a U.S. criminal charge and agreed to pay more than $2.5 billion in penalties for helping Americans evade taxes. Separately, Netherlands' largest bank ING Groep reports fourth-quarter earnings on Wednesday. After spinning off its insurance arm, selling U.S. operations and repaying Dutch state aid, ING appears well capitalized and may boost its dividend or disclose plans to expand within Europe. Mondelez International Inc, the maker of Cadbury chocolate and Oreo cookies, will report fourth-quarter results on Wednesday. The snacks maker has faced sluggish markets in some of its key categories. The company, which raised its full-year 2014 profit forecast in November, has reported a string of disappointing quarterly results since it split from Kraft Foods Group in 2012. Biggest U.S. life insurer Metlife Inc is currently challenging the Financial Stability Oversight Council's decision in a federal court to overturn its "systemically important" tag. The company which reports fourth quarter results on Wednesday mainly invests in bonds and has been hurt by lower yield from these securities due to historically low interest rates. However, speculation that the Fed might start winding down its quantitative easing program has helped boost bond yields in recent months. However, a recovering job market is helping the company's group insurance business. Meanwhile, life and mortgage insurer Genworth Financial Inc is expected to announce its review of long term care insurance active life margins along with its fourth-quarter results on Wednesdsay. The review, to determine loss and cash flow, will show whether the company would need to raise capital for reserves. Company says premium rate increases could help offset the need to strengthen reserves. Regeneron Pharmaceuticals Inc has appeased investors in recent years with flourishing sales of its eye drug, Eylea. The blockbuster drug's quarterly sales, which were preannounced in January, have bested expectations, likely driven by a rising demand. Investor will look for commentary on the progress and commercial potential of three likely blockbuster biotech drugs Regeneron is developing with Sanofi when it reports fourth-quarter results on Tuesday. Tesla Motors Inc will report fourth-quarter results and investors will be listening for an update on the company's battery plant construction, color on weak fourth quarter sales in China that it previously outlined, and details about the planned summer launch of the Model X SUV. The company also will update sales of its flagship Model S sedan when it reports results on Wednesday. Chief Executive Elon Musk may also provide an update on the 2017 rollout of the lower-priced, higher-volume Model 3 car. Fourth-quarter profit of Standard & Poor's parent McGraw Hill Financial Inc is expected to miss estimates when it reports earnings on Thursday, according to StarMine data. Revenue at McGraw Hill's rating unit, its main business, is expected to decline due to a fall in global debt activity and legal settlements for the fourth quarter. Thomson Reuters Corp reports fourth-quarter results and investors will be watching to see if the information and news company can keep up its streak of positive sales for its financial products. The company will also provide a forecast for the year when it reports results on Wednesday. No. 1 U.S. advertising company Omnicom Group Inc is expected to report fourth-quarter profit well below average analysts' estimates, mainly impacted by a weaker Euro. However, U.S. advertising market is expected to remain strong with companies such as Walt Disney and Viacom indicating that advertising spending is expected to return to television. The company has been looking to make acquisitions in the digital and social media space to deal with competition from internet advertising companies such as Google and Yahoo. When the company reports earnings on Tuesday, analysts will be looking for guidance in the context of volatile foreign exchange rates. Breakfast cereals maker Kellogg Co is likely to report fourth-quarter revenue above analysts' expectations, according to Thomson Reuters StarMine, bucking the trend for the last four quarters. The revenue beat is likely to come from international growth, as the company struggles with falling sales in its cereal and snacks business in the United States. Investors will look for comments on the company's plans to expand outside the United States when it announces results on Thursday. Whole Foods Market Inc is enjoying strong demand for the natural and organic category it pioneered, but the competition is forcing it to cut prices to compete with rivals ranging from specialty grocers like Sprouts and the Fresh Market to mass-market operators such as Kroger and Wal-Mart. The company is due to release first-quarter results on Wednesday. Fertilizer company Mosaic Co reports fourth-quarter results and forecasts first-quarter phosphate and potash sales volumes on Wednesday. The company is expected to show higher quarterly profit than a year earlier, thanks to stronger phosphate sales and prices. Starwood Hotels & Resorts Worldwide Inc has been hurt by political instability in its international markets and a strengthening dollar. The operator of Sheraton and Westin chain of hotels, which has nearly halved its properties outside North America, said in October its 2014 profit would also be hit by asset sales. On Tuesday when the company reports fourth-quarter results, investors will be looking for comments on expected trends in 2015, especially since Starwood is the first of U.S. hoteliers to report results. On Tuesday, private equity firm KKR & Co is expected to report a decline in fourth-quarter earnings, as it fails to beat the cash it generated from assets sales a year ago. Separately, Carlyle Group LP is also expected to report a decline in fourth-quarter earnings on Wednesday. Cenovus Energy Inc, which has slashed capital spending twice, deferring some projects and limiting conventional drilling, may outline more steps to fight weak prices when the oil sands developer reports fourth-quarter earnings on Thursday. Separately, Talisman Energy Inc is expected to report a smaller loss when it reports fourth-quarter results on Tuesday, according to analysts. The Canadian oil producer, which agreed to be bought by Repsol, has been cutting jobs and is planning to sell assets. Investors will want to know about the company's dividend, capital budget and production plans for 2015. Telus Corp, the last of Canada's three largest wireless carriers reports fourth-quarter earnings on Thursday. Rogers has been shedding customers that BCE has picked up, but investors expect Telus to also score well in terms of overall market share gains. The Canadian company is reaping the rewards of an earlier rollout of its Internet-based television product, Optik, that's helping the company win landline customers from dominant cable operator Shaw out west. Molson Coors Brewing is likely to report fourth-quarter profit below analysts' expectations, according to Thomson Reuters StarMine. The brewer said in November it would increase marketing spending to boost sales which declined for four of the last five quarters. The company had also warned of currency hurting results in the quarter, particularly in Canada. The company had also said it was engaged in discussions for potential acquisitions, so investors will be looking out for any deal announcements when company reports earnings on Tuesday. MillerCoors LLC, the U.S. operations of Molson Coors, also reports results the same day. Maker of Folgers coffee, J M Smucker Co is likely to report third-quarter profit below analysts' expectations, according to StarMine data. The company in November termed its price increase in June a "misstep", which led to a sharp drop in sales volumes as customers delayed purchases and shifted to cheaper private-label brands. Investors will look for how the latest price increase was received by customers and Smucker's integration plans for its $3.2 billion acquisition of pet food maker Big Heart Pet Brands when the results come out on Friday. Internet content delivery service provider Akamai has said that a stronger U.S. dollar would hurt revenue growth in the fourth-quarter. On Tuesday, the company is expected to report revenue slightly above analysts' estimate according to Thomson Reuters Starmine data. The Western Union Company is to report fourth-quarter results on Tuesday, in line with estimates, according to Thomson Reuters StarMine data. World's largest money-transfer company is facing price competition from its largest competitor, MoneyGram, as it resorts to price cuts to recover lost business from Wal-Mart's new in-store offering. Western Union said in January it would offer consumers the ability to fund money transfers and bill payments using Apple Pay. On Wednesday, Toronto-based gold producer Agnico-Eagle Mines Ltd is expected to report lower fourth-quarter earnings on weaker metals prices. The market will want to hear about the exploration potential of its Amuraq deposit in Nunavut and at the properties owned by Cayden Resources, which Agnico recently purchased. Reporting fourth-quarter results the same day is gold producer Yamana Gold Inc. The Toronto-based company is expected to report weaker earnings on the back of lower metals prices. Investors will want to know of any progress on the planned sale of some of its Brazilian assets. Separately, world's fifth biggest gold producer Kinross Gold Corp is expected to report an adjusted profit compared to a loss a year ago helped in part by lower costs in its large Russian operations where the rouble has slumped. The company's net earnings may include funds from the sale of its stalled gold project in Ecuador late last year for $240 million. Investors will also want an update on the Russian operations and if Western sanctions are having any impact when the company reports fourth-quarter and full-year results on Tuesday. Cybersecurity company FireEye Inc is expected to report fourth-quarter earnings above analysts' expectations on Wednesday as governments and businesses ramp up spending to protect their networks from highly sophisticated database breaches and hacks. The market is estimated to grow from $95.60 billion in 2014 to $155.74 billion by 2019, according to market research firm MarketsandMarkets. Cosmetics maker Avon Products will report fourth-quarter results on Thursday amid controversy in its key market, China. China unit of Avon pleaded guilty in connection with a bribery scheme in December. The direct seller of beauty products has been cutting jobs and undergoing restructuring in an attempt to stem losses and turn itself around. Investors will be looking for updates on sales in North America, where it faces competition from inexpensive beauty items at drugstores or from chains such as Sephora. Commentary on the impact of a stronger dollar during the quarter will be of interest. The advertising company Interpublic Group of Companies Inc is expected to report fourth-quarter revenue below estimates, according to Starmine data. A slowdown in advertising spending, alongside foreign exchange currency volatility is expected to affect advertising companies when it reports results on Friday. Fourth-quarter results of real estate website operator Zillow Inc are expected to be slightly below analysts' estimate, according to StarMine data. Analysts said that a decline in display revenue and a sequential deceleration in average revenue per user will hurt sales. On Tuesday when the company reports earnings, investors will look forward to the benefits expected after the completion of Trulia's acquisition. AOL Inc, which owns Huffington Post news website and the TechCrunch blog, has been in the midst of a turnaround as it moves away from subscription dial-up revenue. Digital media and entertainment Company is expected to report fourth-quarter revenue and profit on Wednesday, slightly above analysts' estimate according to Starmine data. While activist investor Starboard LP reiterated that Yahoo should consider a merger with AOL, the company was rumored to have been approached by Verizon for an acquisition. Time Inc that publishes Sports Illustrated, Time and People magazines is expected to report fourth-quarter revenue slightly above analysts' estimate according to Thomson Reuters Starmine data. The Publisher has cut its full-year 2014 revenue forecast twice in consecutive quarters citing falling circulation and weak print advertising. Investors will be looking for full-year 2015 outlook and positive circulation numbers when company reports earnings on Friday. The largest U.S. milk processor Dean Foods Co is likely to report fourth-quarter profit above analysts' expectations, according to Thomson Reuters StarMine data. The company in November had forecast its first quarterly adjusted profit in a year citing cost cuts and a steep fall in butterfat prices. Raw milk prices have declined as production in the United States and Europe increases, and are expected to come down further in 2015 which will help boost demand. Investors will be looking out for comments on milk prices this year and the company's forecast when it reports results on Tuesday. Shares of the healthcare analytics company Inovalon Holdings Inc are expected to start trading on the Nasdaq on Thursday. The company is expected to raise $533.3 million from its initial public offering of 22.2 million class A shares. The offering is expected to be priced within the range $21-$24, valuing the company at about $3.5 billion at the higher end. U.S.-based holding company Meritas Group Inc and Meritas Holdings LLC are major shareholders. Innovative retail brokerage firm Charles Schwab Corp, which does not hold quarterly analyst calls, gives its three-hour semi-annual update on Thursday. Executives will talk about investor sentiment and product developments but institutional investors will listen for any indications that short-term rates will rise, allowing Schwab to make big profits investing cash lying fallow in client accounts. Nvidia Corp posts first-quarter results on Wednesday as the chipmaker adapts its PC graphics technology to be used for navigation and entertainment systems in high-end cars. Groupon Inc, the online commerce company that began life as a purveyor of discount coupons, updates Wall Street on its turnaround effort on Thursday. The company's fourth-quarter results come just days after the Wall Street Journal reported that it is in talks to sell most of TicketMonster Inc, a company now valued at some $1 billion. Billionaire investor William Ackman hosts a Harbor Investment Conference on Friday with friends and fellow hedge fund managers Ray Dalio and Larry Robbins, who will have things to say about the world and how they'll make money for their clients. Canada will get a snapshot of its housing market next week with reports including housing starts for January. That report will be followed by the new home price index, which is forecast to have edged up by 0.1 percent in December, matching the previous month's pace. Rounding out the week will be a report on manufacturing sales, which are expected to have climbed by 0.9 percent in December, after dropping for two months in a row. Mexico's government agency will show how industrial production fared in December on Wednesday, after the indicator expanded at its slowest pace in two months in November, as a dip in mining and utilities dragged on an expansion in the construction and manufacturing sectors. On Thursday the central bank will release minutes for its January decision to hold interest rates at a record low of 3 percent, as policymakers eyed the risk that a sharply weaker peso could fan consumer prices higher while also nothing big risks to growth. Monday, Feb. 9 Hotel, energy and financial services conglomerate Loews Corp's fourth-quarter results are expected to miss estimates, according to Thomson Reuters StarMine data. Its largest holding, insurer CNA Financial, is facing slowing pace of rate increases. Loews has trimmed CNA's operations by hiving off its life and automobile insurance, reinsurance and pension deposit businesses. However, some of that weakness should be offset by stronger results at Diamond Offshore, Loews' second-biggest subsidiary and one of the world's top five offshore rig contractors, helped by higher demand and improved rates for its ultra-deepwater rigs. However, hurt by a decline in rig rates, Diamond Offshore Drilling Inc is expected to report a lower fourth-quarter profit. 50 percent drop in global crude prices has prompted oil producers to shut down several low-margins projects, hurting rig providers and other oilfield service companies. Investors will look for details on the offshore rig contractor's spending plans, dividend cuts and possible early contract terminations. Hasbro Inc, the second-largest U.S. toymaker, reports fourth-quarter sales. Hasbro has seen demand for its "My Little Pony" toys, and Marvel and Transformers action figures rise in past few quarters, helping it grow ahead of larger rival Mattel. Hasbro has also won the license to make dolls around Walt Disney's Princess and "Frozen" lines starting 2016. Canada Mortgage and Housing Corp releases report on housing starts for January. New construction is expected to have moderated only slightly to 177,500 units last month. (0815/1315) European Central Bank President Mario Draghi takes part in G20 Finance Ministers and Central Bank Governors two-day meeting in Istanbul, where officials will grapple with the question of financial support for neighbouring Greece. Mexico's national statistics agency will release inflation data for the full month of January, after inflation through the first half of the month slowed sharply to 3.08 percent, just above the central bank's 3 percent target. (0900/1400) (All analysts' estimates are according to Thomson Reuters I/B/E/S) (Compiled By Astha Rawat in Bengaluru; Editing by Joyjeet Das and Christian Plumb)
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