Schaeffer's Trading Floor Blog

Earnings on Deck: Baidu Inc (ADR), Pandora Media Inc, and Visa Inc

Taking a closer look at BIDU, P, and V ahead of their earnings results

by 7/24/2014 12:12 PM
Stocks quoted in this article:

It's been quite a week on the earnings front, with big names such as Apple Inc. (NASDAQ:AAPL) and Facebook Inc (NASDAQ:FB) reporting. Tonight, Wall Street will get the latest quarterly updates from Chinese Internet issue Baidu Inc (ADR) (NASDAQ:BIDU), streaming radio concern Pandora Media Inc (NYSE:P), and credit card company Visa Inc (NYSE:V). Here's a quick look at this trio of names as earnings approach.

  • BIDU is in rally mode ahead of its second-quarter earnings report, thanks to a price-target hike to $245 from $215 at Citigroup this morning. At last check, the stock was up 2.6% at $205.22, and earlier hit a record peak of $205.50. If past is prologue, the stock could be poised to extend these gains through week's end. Specifically, over the past six quarters, Baidu Inc (ADR) has gone on to average a single-session post-earnings gain of 3.5%. Option traders are active ahead of tonight's scheduled event, with overall volume trading at roughly two times the average intraday amount. What's more, nine of the 10 most active BIDU options expire at tomorrow's close.

  • Although P has matched or exceeded analysts' bottom-line projections in each of the past eight quarters, the stock has shed an average of 3.9% in the subsequent session. Another poorly received earnings report could prompt the brokerage bunch to re-evaluate their bullish ratings for P, which could create additional headwinds down the road. At present, 73% of covering analysts maintain a "buy" or better rating toward the equity, and the consensus 12-month price target of $34.11 stands at a steep 22% premium to Pandora Media Inc's current perch at $27.95.

  • For V's fiscal third quarter, Wall Street is calling for a per-share profit of $2.10 -- a 22-cent improvement over the company's year-ago results. Over the past eight quarters, the blue chip has turned in a strong showing on the earnings stage, matching or besting consensus profit estimates each time. As such, the stock has averaged a single-session post-earnings advance of 1%. Although V is trading at $223.15 -- just above its year-to-date breakeven mark -- sentiment among the brokerage bunch has tended toward the bullish side. Roughly 83% of analysts weighing in on Visa Inc have levied "buy" or "strong buy" recommendations toward the stock, and the consensus 12-month price target sits in uncharted territory. Elsewhere on the fundamental front, V earlier announced its Visa Digital Solutions suite to help facilitate secure payments across a wide field of web-connected devices.

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