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5 Dow Stocks Likely to Rise After Earnings

Some Dow stocks perform better than others after reporting second-quarter earnings results.

New York Stock Exchange Traders
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New York Stock Exchange Traders

The following five Dow components have notched the biggest gains in the day after posting quarterly numbers in July and August over the past five years. History can be a guide, but nothing is a sure bet.

Shares of Alcoa , typically the first Dow company to publish earnings every quarter, tend to fall following second-quarter results. The aluminum maker said yesterday after the market closed that it swung to a second-quarter profit of 13 cents share, compared with a year-earlier loss of 47 cents a share.

While the average return for Alcoa shares has been negative over the past five years, the stock rose today.

5. AT&T

Reporting Date: Thursday, July 22 (before market opens)

Historical Price Performance: Over the past five years, AT&T shares have returned an average of 1.9% on the day the communications giant reports second-quarter results.

Analyst Consensus: AT&T should report a second-quarter profit of 57 cents a share, according to a Thomson Reuters poll of 30 analysts.

However, analysts have cut their estimates over the past month by an average of 1.1%. Most recently, Cowen & Co. and Bank of America/Merrill Lynch analysts reduced their second-quarter earnings estimates, while Wells Fargo Securities and Macquarie Research raised theirs.

4. IBM

Reporting Date: Monday, July 19 (after market closes)

Historical Price Performance: During the trading session after IBM reports second-quarter results, the stock has risen an average of 3.2% during the past five years. The software-services company has exceeded the Thomson Reuters consensus target for second-quarter earnings for five years.

Analyst Consensus: IBM may post a second-quarter profit of $2.58 a share, according to a poll of 19 analysts by Thomson Reuters. That's up 0.1% over the past month, an indication that analysts are comfortable with their expectations. On Monday, Bank of America/Merrill Lynch analysts increased their second-quarter EPS target to $2.59 from $2.54, although the firm lowered its revenue outlook.

3. JPMorgan Chase

Reporting Date: Thursday, July 15 (before market opens)

Historical Price Performance: During the trading day after reporting second-quarter earnings results, JPMorgan shares have increased by an average of 3.3% over five years.

Analyst Consensus: JPMorgan routinely exceeds Wall Street's expectations. In fact, JPMorgan has topped Thomson Reuters' average analyst estimate in every quarter but one (fourth quarter of 2007) dating back to the first quarter of 2005. This time around, analysts are predicting a profit of 71 cents a share. However, that number has dropped 9.5% over the past month as firms have become less optimistic. Raymond James, Barclays Capital, Sanford C. Bernstein and Bank of America/Merrill Lynch have cut their second-quarter earnings targets for JPMorgan since the start of July.

2. Cisco Systems

Reporting Date: Wednesday, Aug. 11 (after market closes)

Historical Price Performance: Cisco reports fourth-quarter financial results in August based on its fiscal year. Cisco shares have returned an average of 4.1% in the past five years after the network-gear giant posts fiscal fourth-quarter numbers.

Analyst Consensus: Cisco may report a fiscal fourth-quarter profit of 42 cents a share, based on a poll of 35 analysts by Thomson Reuters. That's up 0.2% over the past month, as firms including Pacific Crest Securities and Evercore Partners have slightly increased their estimates. Other firms, including Kaufman Bros. and Avondale Partners, have introduced fiscal fourth-quarter earnings estimates for Cisco in the past month.

1. Hewlett-Packard

Reporting Date: Thursday, Aug. 19 (after market closes)

Historical Price Performance: While most other companies are reporting second-quarter results, H-P reports fiscal third-quarter earnings during August. After announcing fiscal third-quarter results over the past five years, H-P shares climb by an average 4.6%.

Analyst Consensus: H-P should notch a fiscal third-quarter profit of $1.07 a share when it reports quarterly numbers next month, based on a poll of 31 analysts by Thomson Reuters. That number is unchanged in the past 30 days, although most analysts revised earnings expectations after H-P last reported earnings May 18. H-P has topped the average analysts' earnings estimate for the fiscal third quarter each year since 2005.

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Disclosure information was not available for Robert Holmes or his company.

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