Five Stocks to Watch
StreetAuthority | Apr 27, 2012 06:22AM ET
Earnings season is off to a generally solid start, though tucked into the broad group of estimate-beating companies are more than a few cautionary notes: A range of companies -- many of which have exposure to Europe or China -- are speaking of tougher times ahead.
That was certainly the case with Ford (NYSE: ELON )
Reports: May 9
Expected EPS: $-0.29
Expected y-o-y sales growth: 8%
This maker of smart-grid equipment remains far too cheap.
It will never see the $80 level it saw more than a decade ago, or even the $30 level it saw in 2007. But just a return to the $10 level it was trading at a year ago yields a double, which is where I think it'll be the next time Echelon enters into one of its periodic phases of new contract momentum.
To be sure, this company possesses a solid base of technology. Slow spending by utilities has been the key culprit. That's why I'm heartened that Echelon is aggressively pursuing relationships in Brazil and China, which currently appear more committed to making major investments in energy-enhancement initiatives.
Don't expect great results from Echelon this quarter. Instead, it's the discussion on the status and development of those international relationships that investors will be watching.
Action to Take--> I may not immediately comment on these quarterly reports, as the company's press releases and subsequent media coverage often tell the tale. I will, however, follow up if and when a major shift in the investment thesis -- either positive or negative -- needs to be analyzed. Stay tuned.
BY David Sterman
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