Earnings Estimates (High/Mean/Low): $0.74 / $0.726 / $0.69

Amidst growing fears of a double-dip in both the US and international economies, many investors have begun to find high-beta names unsuitable for their portfolio.  A quick glance at the yield on a 10-Year Treasury is evidence enough of this flight to safety, and, as such, companies like Heinz (NYSE: HNZ) continue to attract Street attention.  With FQ1 earnings scheduled for this Wednesday, we’ll get a nice peak into the state of what should be a stable, relatively recession-proof business, ketchup.

HNZ has built up a solid chart over the past few months.  After breaking its 200-day moving average on 6/28, shares retook the line less than a week later and have since successfully re-tested the mark twice, first on 7/30 and then again on 8/12.  Shares closed up last week at $46.85 and are up 8.4% YTD.

HNZ has beaten estimates in ten of the past eleven quarters and the past eight in a row.  Mean estimates of $0.726 represent an 8% YoY gain.  The conference call is currently scheduled for 8:30 a.m. Eastern the morning of the report.

As we discussed above, investor sentiment has largely begun to swing in favor of “safety” names.  HNZ is particularly well-suited to be mentioned as a part of that group, as much of their earnings, and a growing portion thereof, are derived from higher-growth overseas markets.  A dividend yield of nearly 4% is just the icing on the cake.

There’s little reason to open up a new position ahead of the report, as the climate of negativity is liable to affect post-earnings trading in any number of ways.  On a post-earnings selloff, look to get behind shares on a test of the 200-day, and on a pop look to be a buyer on a breakout of the aforementioned range.  Either way, you should consider HNZ a solid candidate for your portfolio, particularly if you’re looking to incorporate additional elements of stability.

Disclosure: No holdings in HNZ.

Earnings: Q4 profits, excluding items, of $0.42 vs. estimates of $0.38 and $0.39 in Q4 last year.

Revenue: Up 28% YoY to $159 million.

Jeff Weiss, the company’s Chairman and CEO, stated, “I am excited to announce another year of record performance for our Company with consolidated total revenue growing by 15.7% to a record $610.9 million for the fiscal year, while consolidated adjusted EBITDA increased to a record $182.2 million, a 31.6% increase over the prior fiscal year. This record performance was achieved despite a challenging global economy still suffering with high unemployment and a significantly reduced average work week for hourly wage based workers.”

Comment: Dollar Financial (NASDAQ: DLLR) provides a wide range of consumer financial products and services including check cashing, single-payment consumer loans, longer-term installment loans, pawn lending, debit cards, phone/gift cards, bill payment, money orders, money transfers, foreign exchange, gold buying and legal document processing services.  As of June 30, 2009, DLLR’s global store network consisted of 1,206 locations, and it demonstrated to the Street last Thursday that now may be the time to get behind shares.

Besides the beat on EPS and revs, operating margins rose to 41.4% from 34.7% and fees from consumer lending, the company’s cash cow, shot up 28% YoY, though check-cashing revs fell marginally.  Pawn related revenue nearly doubled, but remains a relatively small piece of the DLLR pie.

DLLR issued positive guidance, forecasting FY11 earnings from operations of $2.05-$2.30 vs. estimates of $2.01.  Management also announced the acquisition of Folkia Group for approx. $28 million, a deal that is expected to be immediately accretive.

Shares traded up huge off the news, adding more than 26% in a single day.  DLLR had seen it’s price fall by more than 40% since mid-April as news relating to a class action suit out of Canada overhung shares.  With the Q4 beat and management commentary, the Street seems to have had those concerns at least partially alleviated.

With it’s recent downtrend officially broken, look for shares to test resistance in the $20.24-$20.72 range.  If they can push through, a move towards $23-$24 would be the next objective.  From a longer-term standpoint, particularly after seeing post-earnings selloffs in companies like J. Crew (JCG), Coach (COH) and Tiffany & Co. (TIF) in just the past week, a move into a company like DLLR may be the way to go.  All three of the above and many more have warned of a second half slowdown, and it’s in those environments that a payday loan/check-cashing company is likely to thrive.

As we’ve expounded here at Wall St. Cheat Sheet over and again, an underclass is developing in America.  When those afflicted can no longer participate in the conventional economy, companies like DLLR will be the one’s laying in wait, offering them near-usurous short-term financing.  As the underclass expands, profit opportunities for DLLR cannot but expand in lock-step.

Disclosure: No holdings in DLLR.

Earnings: Q2 profits of $0.53 vs. estimates of $0.46 and $0.29 in Q2 last year.

Revenue: Up 14% to $407.5 million vs. estimates of $403 million.

According to investment firm Brean Murray, “investors [are] likely worried about the difficult comparisons J. Crew faces in the second half of the fiscal year, but [sic] the company [will] benefit from a highly differentiated viewpoint and a fashion-driven core consumer who will pay full price for the right offerings.”

Comment: J.Crew Group (NYSE: JCG) blew away the numbers for Q2, upping profits 88% YoY, but weak guidance is pressuring shares after-hours.  Management forecasted Q3 earnings of $0.55-$0.65 vs. expectations of $0.71 and lowered their FY2010 target by $0.10 to $2.25-$2.35.  Inventory per square foot also increased by about 10%.

Add that all up and you’ve got a stock that’s trading down 6.76% after-hours on top of a 0.65% decline during regular trading.  Shares last changed hands at $31.17, a price they haven’t hit since around this time last year.

This news coincides with another story reported earlier today at the Wall St. Cheat Sheet regarding Coach (COH), indicating impending weakness at higher-priced retailers, a sector that held up through much of the downturn.  This may be a result of an American consumer who many say have now completely acclimated to a recessionary environment and find themselves comfortable spending less money.

JCG has always been known to be among the best retailers at executing high-margin strategies, but the company seems to be losing steam.  Until we see a well-founded reason to get back behind shares, J. Crew looks like a stock worth avoiding.

Disclosure: No holdings in JCG.

Earnings: Q3 profits excluding items of $0.61 vs. estimates of $0.53 and $0.18 in Q3 last year.

Revenue: Up 52% YoY to $550 million, in-line with management’s revised guidance and at the high end of the company’s original guidance.

CEO Hock Tan noted that Avago (NASDAQ: AVGO) “reached a historic milestone in the third quarter of fiscal 2010.  In addition to another record net revenue quarter, Avago’s non-GAAP Gross Margins surpassed 50% as [the company] continued to execute well on [its] strategy of expanding gross margins.”

He added that, “business remains robust and our proprietary products continue to gain momentum as we win more programs at major OEMs.”

Comment: Avago designs, develops and supplies a range of analog semiconductor devices with a focus on III-V-based products.  This form of compound semiconductor is desirable for its thermal properties, which allow for higher-efficiency power consumption.  They are used in FBAR filters, power amplifiers, front-end modules and light emitting diodes, primarily in wireless handsets and equipment.

On top of its earnings and revenue beat, AVGO also gave solid guidance for the current Q, forecasting a 3%-6% rise in revenue QoQ to $566.5 million-$583 million vs. estimates of $557 million.  Unadjusted gross margins rose to 47.8% from 38.8%.

Shares shed 1.38% during after-hours trading after dropping 0.78% on the day, last changing hands at $19.96.  An on-again, off-again secondary offering from major shareholder KKR has been weighing on shares for the better part of a month, and seems to still be in AVGO’s way.  Still, despite the potentially dilutive effects of such an offering, AVGO saw its debt rating upped by S&P this past Monday.  S&P cited revenue strength and appropriate debt level as its reason for boosting AVGO’s rating to BB+, or on notch below investment grade.

From a technical standpoint, AVGO was able to hold its 200-day moving average on August 11th, a day in which big negative news concerning the semi space took down the whole sector.  That indicator, which now rests at about $19.50, is just $0.46 below today’s after-hours close, and shares may be ready to test the mark again.  If AVGO can make it through a second test, that should definitely be taken as a cause to give shares a second look.  Given their exposure to smartphones, AVGO is better situated to weather weakness in semis than many of its peers.  As such, putting on a pairs trade vs. a weaker competitor may be the way to go.

Disclosure: No holdings in AVGO.

Earnings: Q2 profits of $0.30 vs. consensus $0.23 and $0.22 in Q2 last year.

Revenue: Up 22% to $158.2 million vs. estimates of $143 million.

According to CEO Jason Jiang, the Chinese ad market grew 17% YoY during 1H10.  He added that Focus Media (NASDAQ: FMCN) “managed to expand [its] core business 24% during the same period, indicating [that] it continues to gain market share.”

Comment: FMCN, a China-based digital advertising company, continued to benefit from a broad-based ad market recovery in China as the company’s Q2 profits came in well ahead of estimates.  After tacking on nearly 2.5% during regular trading, Focus added another 2.5% for good measure after-hours, last changing hands at $19.01.  Shares are now up 17% on the year.

In addition to the beat on EPS and revenue, sales of LCD display ads grew 34% YoY and Internet ads grew 41%, both ahead of prior guidance.  Gross margins expanded modestly to 51.6% from 51.4%.

Guidance was strong as well, with management forecasting Q3 profits of $48-$49 million on cumulative revenue (LCD, movie theater, in-store and poster frame) of $121.5 million, good for 37% YoY growth.  Billboard revenue is expected to come in at $20-$23 million.

There isn’t much to complain about concerning FMCN’s Q, and from a technical perspective they’re looking pretty good too.  As you can see on the weekly chart below, FMCN began forming a nice, fairly tight cup-with-handle pattern in mid-April, and it seems poised to break out.  The current buy-point stands at $19.36, or $0.10 above the high-point in the handle.  If it can get through there on solid volume, a move towards $21, and then $24, may be in order.

Disclosure: No holdings in FMCN.

Earnings Estimates (High/Mean/Low): $0.21 / $0.193 / $0.17

99 Cents Only Stores (NYSE: NDN) announced last Friday that it will release financial results for its fiscal first quarter ended June 26 shortly after the market closes on Wednesday, August 4.  The conference call is scheduled to follow at about 4:30 PM EST.

NDN operates 276 “extreme value” retail stores, over 200 of which are located in California.  The company opened 9 new locations in fiscal ’10, but also closed 13.  Their report should give us a nice glimpse into the American consumer, as dollar stores have thriven during these times of high unemployment and abysmal consumer sentiment.  As such, NDN saw YoY earnings growth of 600% from ’08-’09 and 210% from ’09-’10.  However, current forecasts of 17% EPS growth from ’10-’11 may be an indication that the $1.2 billion company is hitting a ceiling in terms of expansion.

As you can see below, NDN possesses a very constructive chart.  Since hitting lows of $5.37 in July ’08, shares have put together a two year streak of higher highs and higher lows, hitting a 52-week high of $18.10 in early April. NDN has beaten estimates seven quarters in a row, and a beat on Wednesday will have investors watching to see if they can break through that mark, indicating the potential for yet another leg higher in its multi-year uptrend.

Disclosure: No holdings in NDN.

Earnings: Q2 profits of $0.03 vs. $0.04 consensus and $0.04 in Q2 last year.

Revenue: Up 33.8% to $42 million vs. $39.6 million consensus.

Dr. Magid Abraham, comScore’s (NASDAQ: SCOR) president and chief executive officer noted that he is “pleased with the excellent revenue and adjusted EBITDA growth [SCOR] achieved in the second quarter.  Both metrics were well above our previously announced guidance and reflected positive growth in virtually every product area and customer segment.

He went on to say that, “our revenue growth was also driven in part by the addition of new customers during the quarter.  We added 72 net new customers in the second quarter, a record for quarterly organic net new customer additions.  As many of these customers are subscription-based, we expect to see contributions from these additions in future quarters.”

Comment: Despite falling short of EPS estimates, shares of SCOR traded higher off its Q2 report, gaining nearly 10% in days following the release.  Besides beating on revs, the company issued upside guidance, forecasting FY10 revenue to grow 31%-33% YoY to $167.3-$169.9 million vs. $164.99 million consensus.  The Street also seems to be reacting favorably to SCOR’s acquisition of the products division of Nexius, a move aimed at bringing a suite of wireless network analysis products to the comScore portfolio.  Management expects this new capability to allow them to “expand [their] addressable market and our reach in the global telecommunications industry by providing carrier-level analytics for the wireless market.”

From a technical standpoint, SCOR has a fairly favorable chart.  Shares finally managed to break through resistance in the $18-$18.50 range in the days following the report.  What’s more is the convincing fashion in which they did so, registering two of their highest volume days of the year on Thursday and Friday and closing out the week on their highs.

SCOR, a “leader in measuring the digital world,” is a digital marketing intelligence platform aimed at helping its customers make business decisions and implement digital business strategies.  Their products and solutions offer customers deep insights into consumer behavior, including objective, detailed information regarding usage of their online properties and those of their competitors, coupled with information on consumer demographic characteristics, attitudes, lifestyles and offline behavior.

Disclosure: No holdings in SCOR.

Consensus Estimates (High/Mean/Low): $1.23 / $1.199 / $1.16

Oakland, CA based Clorox Co. (NYSE: CLX) reports FQ4 earnings this Tuesday, August 3, before the bell.  This Q is definitely one that’s worth paying attention to, as they should give us a solid glance into the earnings picture for the entire consumer staples space.  The conference call is currently scheduled for 1:20 PM EST on the day of the report.

CLX has beaten estimates in 10 of the past 11 quarters, including the past eight in a row.  Mean estimates of $1.199 are in-line with last year’s FQ4 report of $1.20 and a slight increase of last Q’s $1.16.

CLX is a leading manufacturer and marketer of consumer products, boasting 8,300 employees and FY09 revenues of $5.5 billion.  The company markets some of consumers’ most trusted and recognized brand names, including its namesake bleach and cleaning products; Green Works natural cleaning and laundry products; Kingsford charcoal; Hidden Valley and K C Masterpiece dressings and sauces; Brita water-filtration systems; Glad bags, wraps and containers; and Burt’s Bees natural personal care products.  The company’s products are manufactured in more than two dozen countries and sold in more than 100 countries.

CLX is also the proud owner of a very constructive long-term chart, as it is threatening to break out of a 3+ year range.  The stock hit a high of $69.36 during May ’07 before embarking on a long-term down-trend that eventually pressured shares down to $45.67 at the March ’09 lows.  Since then, shares have consistently rallied, not falling victim to 2010′s two major dips and hitting 52-week highs over the past few months.  The stock finished up last week at $64.88.  A breakout through $69.46 would be a very bullish signal.

Add in a 3.39% dividend and a 15X multiple on dependable near-10% YoY EPS increases going out as far as the eye can see, and CLX is shaping up to be a very solid buy for anyone looking to add some safety names to their portfolio.

Disclosure: No holdings in CLX.

Earnings: Q2 profits of $1.38 (excluding a special dividend of $0.17) vs. $1.19 consensus and $0.62 in Q2 last year.

Revenue: Up 68% YoY to $1.44 billion vs. estimates of $1.4 billion.

During the conference call, management noted that, “demand for food continued to rise in the quarter and grain inventories [are] expected to tighten, creating an environment that supported the ongoing rebound in fertilizer demand and operating rates.”

Comment: Potash Corp. (NYSE: POT) beat on the numbers and boosted 2010 guidance as the continuing recovery in fertilizer demand allowed it to more than double second-quarter profits when it reported its quarterly results this past Thursday before the bell.  Q2 GMs more than tripled to $584 million and EBITDA more than doubled to $769 million.  The company said that significantly improved potash sales volumes, totaling 1.9 million metric tons for the Q, generated potash-specific GMs of $397 million.  However, realized potash prices were down about 35% YoY as new pricing was established in all major markets in the wake of the global economic downturn.

Management boosted guidance again and is now expecting earnings of $5-$5.50 for the year and Q3 EPS of $0.80-$1.20 a share.  Previous guidance sought $4.50-$5.25 for the year.   Consensus FY2010 EPS estimates now stand at $5.31.

After surging to highs of $241.62 in the summer of ’08, shares of the Saskatoon based potash producer fell all the way to $47.54, an 80% dip.  Since then, there has been a degree of stabilization, as shares have bounced around between $100-$120 for most of the past year before finally breaking downward during the July lows.  POT has rallied nicely since then and was knocking on the door of it’s former range heading into Thursday’s earnings release, trading at $97.71.  Following the strong report, shares were lifted back above $100, finishing up the week at $104.87.

Given POT’s recent strength on high volume, shares have firmly re-taken their prior range.  As such, a move back into the 115-120 area is likely to occur if we get a strong market over the next month or so.  POT is about as tied to the global ag boom as a company can be, and as such, shares are highly correlated to global macro news.  If you’re a believer in the recovery, this is definitely the type of name you want to be in.

Disclosure: No holdings in POT.

Earnings Expectations (High/Mean/Low): $0.51 / $0.489 / $0.47

Expectations for shares of Nasdaq OMX Group Inc. (NASDAQ: NDAQ) will be somewhat muted prior to the company’s Q2 earnings release this Tuesday before the bell.  The Street is expecting the exchange to report quarterly EPS of $0.489, just one cent above the company’s 2Q09 number.  Revenue is expected to remain flat YOY.

Expectations run far higher for other exchange stocks, like CME Group (NASDAQ: CME), which also repots Tuesday morning.  CME, the world’s biggest futures exchange operator, has already said that the second quarter was its second-busiest ever in terms of daily trading activity thanks to an all-time record in May, likely helped by the historic May 6 crash and resulting market volatility.

No such statements out of the Nasdaq camp, but that doesn’t mean that shares aren’t interesting at current levels.  Shares have plunged as much as 26% over the past few months as typically light summer trading seems to get even lighter with each passing day.  But, as with all good things, all cycles must also come to an end, making shares of NDAQ a potentially decent contrarian bet.  Once labor day is in the rearview mirror and Street participants stop taking long weekends in the hamptons and start getting back to business, volume is sure to rise.  This may yield a similar result in shares of NDAQ.  If they can beat the on the numbers and issue solid guidance, look for shares to push towards $20 and keep a tight stop.

NDAQ has beaten estimates in eight of its last eleven reports, albeit often by only a small margin.

Disclosure: No holdings in NDAQ.