What to Watch in the Day Ahead - Wednesday, Feb 3

Tue Feb 2, 2016 2:29pm EST
 
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(The Day Ahead is an email and PDF publication that includes
the day's major stories and events, analyses and other features.
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Comcast Corp, the largest U.S. cable operator, is expected to
report fourth-quarter revenue above analysts' average estimate,
according to Thomson Reuters StarMine. Comcast has benefited
from growth in customer additions at its high-speed Internet
business. As viewers gravitate toward online video offerings,
pay-TV operators including Comcast are battling streaming video
services from Netflix Inc and Hulu for subscribers. The U.S.
Department of Justice is also investigating whether Comcast is
hindering competition in cable advertising sales, Reuters
reported in November.
    
General Motor Co reports fourth-quarter and full-year 2015
results. Company executives have already signaled that the
carmaker would report robust earnings and maintain a bright
outlook for 2016. GM and rival Ford Motor Co have each been
reporting results and outlook that show that both companies have
come back strong after the 2008 recession. If GM carries out its
plan, the once-bankrupt automaker will have returned to
shareholders about $23 billion between 2012 and the end of 2017,
or about 90 percent of its free cash flow. GM has allied with
several companies including ride-sharing Lyft as it attempts to
evolve with the transforming transportation industry.
    
Merck & Co is seen reporting slightly lower fourth-quarter
sales, hurt by a strong dollar and declining sales of its
Remicade arthritis treatment. Investors will be mostly focused
on how the company's new immuno-oncology drug, Keytruda, is
doing in its ongoing battle with Bristol-Myers Squibb's similar
Opdivo treatment for melanoma and lung cancer.

Payrolls processor ADP is likely to report that private
employers added 195,000 jobs in January, lower than the 257,000
they added in December, according to a Reuters survey.
(0815/1315) Separately, the ISM is expected to report that its
non-manufacturing sector index slipped to 55.1 in January from
55.3 in December. (1000/1500)

MetLife Inc, the biggest U.S. life insurer, is expected to
report a slight decline in its fourth-quarter profit as higher
interest rates led to losses in its derivatives portfolio. The
company has long relied heavily on its substantial derivatives
program to hedge against risks that insurers are exposed to such
as currency exchange rates, volatile equities markets and
changes to interest rates. MetLife announced plans last month to
spin off a substantial portion of its U.S. retail business in an
attempt to avoid being considered a "too-big-to-fail" financial
institution, which need bigger capital cushions. The company,
which is in a legal tangle over this label, may provide further
details on the initial public offering or sale of the retail
business.

Yum Brands Inc, the owner of the KFC and Pizza Hut chains, is
expected to report fourth-quarter earnings above the average
analysts' estimate, according to Thomson Reuters StarMine. The
company, which is spinning off its dominant China business,
reported a slight rise in sales at established China restaurants
in December. The company has also said it will return up to $6.2
billion to shareholders before separating its China business and
listing it on the New York Stock Exchange, and possibly in Hong
Kong. Investors will look for commentary on sales in the United
States, where fast-food companies are promoting aggressively to
win back customers, the impending China business spinoff and
sales forecast for China.

Home and auto insurer Allstate Corp is expected to report a rise
in fourth-quarter profit, helped by lower catastrophe losses.
Earnings could also be boosted by rising U.S. auto sales, which
set a new record for 2015. However, rival Travelers Cos Inc
reported a fall in quarterly profit as its underwriting gains
fell and the company earned less from its fixed income and
energy investments.

In its first-quarter results, Keurig Green Mountain Inc is
expected to report a profit below analysts' expectations,
according to Thomson Reuters StarMine. Europe's JAB Holding Co
said in December that it was leading a $13.9 billion buyout of
the K-Cup single-serve coffee pods maker to become the biggest
player in North America's single-serve coffee market. Keurig has
been grappling with slowing sales and has said it is reducing
its workforce by about 5 percent to cut costs. Investors will be
looking for commentary on the impending deal.

U.S. refiner Marathon Petroleum Corp is expected to report a
fall in fourth-quarter profit, hurt by the contracting price
difference between U.S. crude and globally traded Brent. Diesel
prices are also weakening due to falling demand and elevated
inventories, hurting margins at refiners such as Marathon. 

Media mogul Barry Diller's IAC/InterActiveCorp is expected to
report fourth-quarter revenue and profit slightly below
analysts' estimates. Earlier, the company's online dating
service, Match.com, which went public in November, was a big
driver of revenue. Investors want to see how the company fares
in the absence of the dating business. IAC, which owns
Investopedia and video-sharing website Vimeo, reported a fall in
its search and applications business in the third quarter. The
company has been losing market share and subscribers as it
charges customers membership fees to access reviews and ratings
on its site that Yelp Inc, TripAdvisor Inc and others provide
for free.

National Oilwell Varco Inc, the largest U.S. oilfield equipment
provider, is expected to post a smaller first-quarter profit as
oil producers cut spending due to a steep fall in oil prices.
The company, which has been grappling with falling orders for
new equipment, has been laying off employees to cut costs. The
company said in December it would cut 1,500 jobs in Norway. 

Aircraft parts maker Spirit Aerosystems Holdings Inc is expected
to report higher revenue and profit for the fourth quarter,
helped by strong demand for commercial planes. Investors will
look for comments on how Boeing's forecast of fewer plane
deliveries in 2016 would affect Spirit's financial performance
in the year.

Take-Two Interactive Software Inc is expected to report
third-quarter revenue and profit above analysts' estimates,
according to Thomson Reuters StarMine. The videogame maker is
expected to benefit from higher-margin digital game sales, the
new release of wrestling game WWE 2K16 and continued strength of
its flagship Grand Theft Auto. Analysts and investors will look
for details on its forecast for 2017 and whether any blockbuster
Rockstar game is on the cards after Rockstar North President
Leslie Benzies, reportedly responsible for the GTA series
gameplay, left the company last month.

Shutterfly Inc, which provides personalized photo-based
products, is expected to report fourth-quarter revenue and
profit largely in line with analysts' expectations, according to
Thomson Reuters StarMine. Investors will seek details on the
number of customers using the company's online photo-sharing
service, which enables users to share, print and preserve their
memories.
    
Suncor Energy Inc, Canada's largest oil and gas producer,
reports fourth-quarter earnings. Like all oil sands producers,
the company endured a torrid three months in which global oil
prices continued to slide, although its refining business
provided some cushion. Results will give insight into what steps
Suncor is taking to survive the weak pricing environment, and so
far the company appears to be managing well. Last month, the
company struck a deal to acquire rival Canadian Oil Sands Ltd,
giving it the biggest stake in the joint venture Syncrude
project in northern Alberta, Canada's largest single-source
crude producer.
    
LIVECHAT-US EARNINGS with Lipper Alpha Insight
A Lipper Alpha Insight researcher takes questions on winners and
losers in the U.S. reporting season and what lies ahead for
American corporate profits amid slowing global markets, slumping
oil prices and a strong dollar. (1100 ET/1600 GMT)
To join the Global Markets Forum, click here bit.ly/1kTxdKD
 

 (Compiled by Astha Rawat in Bengaluru; Editing by Maju Samuel)