Sunday, June 17, 2012

Earnings Preview: CA Inc. Reports Q3 Results Tuesday

CA Inc. (CA) is anticipated to report earnings after the closing bell on January 24, 2012.

CA Technologies, together with its subsidiaries, designs, develops, markets, delivers, licenses and supports information technology (IT) management software products that operate on a range of hardware platforms and operating systems. The company was founded in 1974 and is based in Islandia, New York. CA trades an average of 2.6 million shares per day.

52 Week High: $25.68

52 Week Low: $18.60

Book Value: $11.58

Float Short: 3.67%

According to EDGAR Online, on average, 9 analysts are expecting the same in earnings as the last quarter of $0.51. Investors will be looking to see a number north of $0.51 per share, based on the earnings estimates. Analyst estimates range between $0.47 and $0.53 per share.

The current trailing twelve months P/E ratio is 11.3. The forward P/E ratio is 10.9. CA just smashed through the 200 day moving average with conviction and the chart looks a lot stronger than it did about a month ago. The PE is so low that even with the problems at hand there is no way I would be shorting here. The short interest is not high as well indicating smart money is not interested in betting against CA either.

For the same fiscal period year-over-year, revenue has improved to $4.43 billion for 2011 vs. $4.23 billion for 2010. The bottom line has rising earnings year-over-year of $827.00 million for 2011 vs. $771.00 million for 2010. The company's earnings before interest and taxes are rising with an EBIT year-over-year of $1.25 billion for 2011 vs. $1.23 billion for 2010. Rising revenue along with rising earnings is a very good sign and what we want to see with our companies. Be sure to check the margins to make sure that the bottom line is keeping up with the top line.

Here is a look at the fiscal year revenue.

Gross reported revenue compared to the mean estimate (rounded).

Fiscal Quarter Ending Month-Year Revenue Estimates Actual $ Difference Difference %
Sep-11 $ 1.19 B $ 1.20 B $ 6.53 M 0.55%
Jun-11 $ 1.14 B $ 1.16 B $ 18.71 M 1.64%
Mar-11 $ 1.16 B $ 1.13 B $ -32.08 M -2.77%
Dec-10 $ 1.14 B $ 1.17 B $ 22.08 M 1.93%
Sep-10 $ 1.10 B $ 1.11 B $ 12.82 M 1.17%

M = millions, B = billions

Differences are rounded. (Some one-time items are often excluded in reported EPS.)

Reported earnings per share compared to the mean estimate. Differences are rounded.

The total short interest number of shares for CA.

The number of days to cover short interest based on average daily trading volume for CA.

Please feel free to share your thoughts and comments.

I use a proprietary blend of technical analysis, financial crowd behavior and fundamentals in my short-term trades, and while not totally the same in longer swing trades to investments, the concepts used are similar. You may want to use this article as a starting point of your own research with your financial planner. I use Seeking Alpha, Edgar Online and Yahoo Finance for most of my data. I use the "confirmed" symbols from earnings.com that I believe to be of the most interest.

Disclosure: I have no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours.

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