Notwithstanding escalation in Eastern Europe, this week’s economic calendar is relatively quiet with just US retail sales (Thursday), and University of Michigan confidence (Friday) taking centre stage. On Wednesday, the Reserve Bank of New Zealand meet and are expected to raise rates a quarter percent to 2.75%. For forex traders I think there is more value in selling NZD short just before the meeting. With the global economy still fragile and most central banks still in easing mode there is a chance that NZ bankers will wait another month before raising.
Getting back to stocks and there’s more earnings announcements out this week. My earnings stock picks include 3 stocks, all with PEG less than 1.
Earnings stock picks
Inter Parfums Inc ($IPAR)
Inter Parfums Inc release earnings on Tuesday so long positions should be entered well before the announcement. IPAR looks to be nicely undervalued and it would be no surprise to see it advance on its earnings this week. Indeed IPAR has beaten guidance on each of the 4 last occassions. Stop can be placed at $32.90.
Dresser-Rand Group Inc ($DRC)
Later on in the week DRC will report earnings. The company is, again, nicely valued with PE of 20.6, PEG 0.98 and current ratio of 1.90. Barclays have an upper price target on the stock of $77 and I can see it advancing from its current price of $58.
Ebix Inc ($EBIX)
Ebix may be one of the most hated stocks in the S&P1500 but for this week I like it. Financials look good and the company could kick on if earnings come in near or above expectations. EPS has been growing at over 35% for the last 5 years. They’re released on Friday and could cause a nice surprise.