By Ben Fox Rubin
The first week of earnings season will start with a slew of
major and notable companies, focused especially on the banking and
technology sectors. There should be two big-name IPOs debuting, as
well.
Also, data reports will detail housing and factory
information.
Major Financial Firms to Report
Next week's earnings calendar will bring many of the biggest
names in the financial sector, including Goldman Sachs Group Inc.
(GS), Morgan Stanley (MS), Bank of America Corp. (BAC) and
Citigroup Inc. (C).
Commercial bank earnings will likely be challenged by falling
revenue in their mortgage businesses, because both mortgage
originations and commercial loans are expected to have weakened
from the fourth quarter. In capital markets, a strong January and
February were offset by a mixed March, leaving major investment
firms more of a question mark coming into next week.
More names in next week's financial sector pack include:
American Express Co. (AXP), Bank of New York Mellon Corp. (BK),
Blackrock Inc. (BLK), Blackstone Group L.P. (BX), Capital One
Financial Corp. (COF), Charles Schwab Corp. (SCHW), Piper Jaffray
Cos. (PJC), PNC Financial Services Group Inc. (PNC) and U.S.
Bancorp (USB).
This Friday kicked off earnings season for the big banks, with
J.P. Morgan Chase & Co. (JPM) posting a 33% rise in net income,
while Wells Fargo & Co. (WFC) saw its profit jump 22% even as
its dominant mortgage business is seeing signs of fading. Both beat
market expectations.
Google, Yahoo, More Tech Names Results Expected
Several tech heavyweights will be reporting earnings next week,
including Google Inc. (GOOG), Yahoo Inc. (YHOO), Microsoft Corp.
(MSFT), International Business Machines Corp. (IBM) and Intel Corp.
(INTC).
Yahoo has been under particularly close scrutiny since Marissa
Mayer, a former Google executive, took over as CEO in July, as many
have watched for her plans to turn around the struggling Internet
pioneer. Ms. Mayer has sought to focus on mobile technology,
creating key partnerships and raising user numbers. The company has
done that so far by buying a handful of small mobile startups, and
also redesigning the Yahoo home page, Yahoo Mail and the Flickr
photo-sharing service. Yahoo was also reportedly in talks to buy a
controlling stake in France Telecom's (FTE) online-video site
Dailymotion and may be looking to expand its partnership with Apple
Inc. (AAPL), which currently includes Yahoo providing data for
finance and weather apps that come preloaded on iPhones.
The new leadership has been an encouraging sign for investors,
who have bid up the company's stock to its highest levels since
2008.
Earnings Grab Bag
There are quite a few other major firms reporting, including
McDonald's Corp. (MCD), Johnson & Johnson (JNJ), Verizon
Communications Inc. (VZ), cola rivals Coca-Cola Co. (KO) and
PepsiCo Inc. (PEP), oil-fields services giant Schlumberger Ltd.
(SLB), and industrial conglomerates General Electric Co. (GE) and
Honeywell International Inc. (HON).
SeaWorld, Fairway IPOs to Launch
Two notable names set to go public next week are SeaWorld
Entertainment Inc. and Fairway Group Holdings Corp.
SeaWorld, which was purchased by private-equity shop Blackstone
Group L.P. (BX) three years ago for $2.3 billion, operates 11 theme
parks including three SeaWorlds, two Busch Gardens and other
locations such as Sesame Place and Aquatica. The company plans to
use the funds from the IPO to pay down debt, pay Blackstone to
cancel the advisory contract and for other corporate expenses.
Fairway operates a dozen Fairway Market grocery stores in and
around New York City and plans to use its IPO proceeds to help fund
its expansion into the surrounding suburbs.
Housing and Factory Data in Focus
Housing and manufacturing reports will lead the data parade next
week. Economists expect the numbers to buck the recent trend of
weaker activity last month. But forecasters have been wrong before
about March data.
Next week's factory reports will cover March and April.
The housing market index, to be reported Monday, is viewed as a
gauge of builder confidence. The median forecast calls for the
index to edge up to 45 in April from 44 in March. Tuesday brings
news on housing starts and permits.
Pinnacle Seeks Approval to Exit Bankruptcy
Pinnacle Airlines Corp.'s (PNCLQ) plan to depart Chapter 11
bankruptcy protection as a subsidiary of Delta Air Lines Inc. (DAL)
could take flight next week.
The regional carrier on Wednesday will ask the Manhattan
bankruptcy court to confirm the restructuring plan describing how
it will pay its creditors and emerge from the Chapter 11 case it
launched about a year ago.
The plan would see Pinnacle become a subsidiary of Delta, its
sole customer, which has agreed to help fund Pinnacle's operations
going forward. It also includes a deal whereby Pinnacle will phase
out its fleet of smaller planes and nearly double its number of
large planes, reflecting a trend in the regional airline industry
toward bigger planes.
Also, Eastman Kodak Co. (EKDKQ) on Wednesday will ask the
Manhattan bankruptcy court for more time to control its
restructuring.
--Jacqueline Palank and Kathleen Madigan contributed to this
story.
Write to Ben Fox Rubin at ben.rubin@dowjones.com
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