2008-11-07 20:43:04 -

- Zacks.com releases the list of companies likely to issue earnings surprises. This week's list includes Becton Dickinson (NYSE: BDX), Cisco Systems (Nasdaq: CSCO), Penn Virginia Corporation (NYSE: PVA), SuccessFactors (Nasdaq: SFSF) and Sunoco (NYSE: SUN). To see more earnings analysis, visit at.zacks.com/?id=3207.

Earnings Preview is written by Charles Rotblut, CFA, Senior Market Analyst for Zacks.com.

The Week's

Events

November has historically been one of the best months for the major markets, according to the Stock Trader's Almanac. And stocks ended the last week of October with a gain.

Will the momentum continue? Given the weak economic conditions, the best investors should hope for is a continuation of the trading range that has formed since Oct 10.

The first week of November will be filled with earnings reports. We have confirmed announcements from 730 companies, including 83 members of the S&P 500. The most notable name on the calendar is Cisco Systems (Nasdaq: CSCO).

The new president will immediately be greeted with another dour jobs report. October employment numbers will be released on Friday.

Other key economic data will include:

-- Monday: October ISM manufacturing index, September construction spending

-- Tuesday: October auto sales, September factory orders

-- Wednesday: October ISM services index, weekly crude inventories

-- Thursday: Preliminary third-quarter GDP, weekly initial jobless claims

-- Friday: October unemployment rate and nonfarm payrolls, September pending home sales, September wholesale inventories, September consumer credit

Fed governor Kevin Warsh will give a speech about the "new financial architecture" at New York University on Thursday evening. The Federal Reserve's web site does not list any other speeches.

The credit crunch, the economy, central banks and trader sentiment are still wildcards. Despite all of the volatility, the major indexes have stayed in trading ranges since Oct 10. The longer these ranges continue to hold, the more likely it is that buyers could emerge. Just remember, however, that we are in a global recession.

Companies That Could Issue Positive Earnings Surprises

Becton Dickinson (NYSE: BDX) has topped analysts' forecasts for 20 consecutive quarters. Though estimates are unchanged ahead of the company's fiscal fourth-quarter report, the impressive streak deserves to be taken into consideration. BDX is scheduled to report on Wednesday, Nov 5, before the start of trading.

SuccessFactors (Nasdaq: SFSF) has reported positive earnings surprises for 3 consecutive quarters. Revisions by 3 of the 13 covering brokerage analysts during the past 30 days have resulted in a slightly narrower projected third-quarter loss for the software company. SFSF is now expected to report a loss of 37 cents per share, though the most accurate estimate is more bullish at a loss of 36 cents per share. SuccessFactors is scheduled to report on Monday, Nov 3, after the close of trading.

Sunoco (NYSE: SUN) topped second-quarter forecasts by a wide margin after disappointing investors during the previous 3 quarters. Falling oil prices have some of the covering brokerage analysts optimistic about another positive surprise. The current consensus earnings estimate of $2.04 per share is nearly a dollar higher than the average projection of a month ago. The most accurate consensus is even more bullish at $2.60 per share. Sunoco is scheduled to report on Wednesday, Nov 5, after the close of trading.

Companies That Could Issue Negative Earnings Surprises

Penn Virginia Corporation (NYSE: PVA) reduced its oil and gas production guidance for 2008 in early October to 46.5-48.0 Bcfe from an earlier projection of 49.7-51.7 Bcfe. During the past 30 days, the consensus earnings estimate has been slashed by 17 cents to 75 cents per share for the third quarter. The most accurate estimate is more bearish at 72 cents per share. Penn Virginia is scheduled to report earnings on Wednesday, Nov 5, after the close of trading.

Charles Rotblut, CFA, is the senior market analyst for Zacks.com.

Want to turn earnings surprises into quick profits? Learn how by visiting at.zacks.com/?id=3206.

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Since 1988, the Zacks Rank has proven that "Earnings estimate revisions are the most powerful force impacting stock prices." Since inception in 1988, #1 Rank Stocks have generated an average annual return of +30%. During the 2000-2002 bear market, Zacks #1 Rank stocks gained +43.8%, while the S&P 500 tumbled -37.6%. Also note that the Zacks Rank system has just as many Strong Sell recommendations (Rank #5) as Strong Buy recommendations (Rank #1). Since 1988, Zacks Rank #5 stocks have underperformed the S&P 500 by 81% annually (+2% versus +11%). Thus, the Zacks Rank system allows investors to truly manage portfolio trading effectively.

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Zacks.com
Charles Rotblut, CFA
Phone: 312-265-9352
Email: pr@zacks.com
Visit: www.Zacks.com