What to Watch in the Day Ahead - Thursday, Feb 11
(The Day Ahead is an email and PDF publication that includes the day's major stories and events, analyses and other features. To receive The Day Ahead, Eikon users can register at . Thomson One users can register at RT/DAY/US. All times in ET/GMT) PepsiCo Inc is expected to report fourth-quarter sales below the average analyst estimate, according to Thomson Reuters StarMine. The company's push into non-carbonated beverages is paying off, with analysts expecting U.S. sales to have got a boost in the quarter from higher pricing and solid sales of Gatorade and Starbucks coffee sold by Pepsi. However, a strong dollar and weakness in Russian and some Latin American currencies are likely to have hurt revenue. Analysts have also raised concerns that the company's Lay's potato chips is losing market share in North America to Kellogg's Pringles and Diamond Foods' Kettle chips. American International Group Inc, which recently announced plans to downsize its retail business after facing pressure from billionaire Carl Icahn, is expected to report a smaller-than-expected fourth-quarter loss. The biggest U.S. commercial insurer said it would spin off its mortgage insurance unit, cut jobs and sell its broker-dealer network. The company plans to return $25 billion in capital to shareholders over the next two years. U.S. Labor Department's report is expected to show that weekly initial claims for state unemployment benefits likely dipped to a seasonally adjusted 281,000 in comparison to 285,000 in the prior week. (0830/1330) TripAdvisor Inc is expected to report a lower profit for the fourth quarter as it continues to roll out its instant booking feature to more geographies. The instant booking feature allows travelers to book a hotel directly from the company's website, instead of being directed to a third-party booking site. While the feature results in improved traveler conversion rate and revenue in the long run, it causes near-term revenue loss as fewer travelers are directed to third-party websites. TripAdvisor gets a big portion of its revenue from payments from third-party booking sites such as hotels and online travel agencies, based on the number of travelers who click on each type of accommodation listing. TripAdvisor rolled out the feature in nine more countries in the fourth quarter. TV network operator CBS Corp is expected to report a rise in fourth-quarter revenue, according to Thomson Reuters StarMine. The company, which owns cable channel Showtime and CBS Sports Networks, has been trying to rely less on ad revenue and it is focusing more on its online subscription streaming services such as CBS All Access. CBS is expected to benefit from strong sports advertising sales. CBS recently resolved its leadership controversy after it said Chief Executive Leslie Moonves would replace Sumner Redstone as executive chairman. Thomson Reuters Corp reports fourth-quarter earnings and forecasts outlook for the year. Investors will be looking at how the news and information company has fared amid currency headwinds, falling oil prices and worries about slowing growth in China. Videogame maker Activision Blizzard Inc reports fourth-quarter earnings. In November, the company agreed to buy "Candy Crush Saga" creator King Digital Entertainment for $5.9 billion as it makes a major push into the fast-growing mobile market. It also launched a film and TV studio to create original content based on its videogame franchises. Activision expects to benefit from strong sales of its newly launched "StarCraft II: Legacy of the Void" game. Avon Products Inc, the pioneer of direct-selling, is expected to report fourth-quarter sales well below analysts' estimates, according to Thomson Reuters StarMine. Avon, which has seen its market share eroded by bigger players, has been on a decade-long turnaround program that included cost cuts and the separation of its North America business. In January, the company and top investor Cerberus Capital laid out plans, such as increasing marketing expenditure and reducing overheads, to boost profitability. However, analysts are not convinced that these steps would reverse its sales decline. Investors will look out for other strategic plans and forecast. Time Inc is expected to report a fall in fourth-quarter revenue, according to Thomson Reuters StarMine. Lower print advertising and circulation revenue might have hurt the revenue of the company, which publishes Sports Illustrated, People and Time magazines. To cope with a relentless decline in the print industry, the company has been slashing costs, tapping revenue sources with higher margins and beefing up its digital offerings. Groupon Inc is expected to report a fall in fourth-quarter revenue but not as steep as analysts had estimated, according to Thomson Reuters StarMine. The operator of daily deals website groupon.com, which has witnessed a slowdown in its active customer base, said in November it would lower its focus on offering consumer electronics and take a $50 million-$100 million hit on its fourth-quarter revenue. Groupon, which named a chief executive in November, is betting on higher marketing spending to woo customers. Minnesota-based Mosaic Co, which is facing declining fertilizer prices, releases fourth-quarter results. Investors will watch for any possible closure of the company's potash production capacity as prices slump. Cyber security company FireEye Inc will likely report a lower-than-expected jump in fourth-quarter revenue, according to Thomson Reuters StarMine. The company had warned that reduced Chinese hacking had hurt U.S. demand and that its sales had fallen short in Europe. Analysts are skeptical of that reason and believe that the company is affected by intensifying competition from rivals such as Palo Alto Networks Inc. Canada's new home price index likely grew 0.2 percent in December, unchanged from November. (0830/1330) TransCanada Corp, Canada's second-largest pipeline company, is expected to report a lower fourth-quarter profit, as a drop in power prices in Alberta weighs on its energy unit. Investors will focus on the company's plans for its pipeline business. U.S. President Barack Obama rejected the company's controversial Keystone XL pipeline last year. Telus Corp, one of Canada's three dominant wireless companies, posts fourth-quarter earnings. Telus is expected to post a slip in overall profit in a tough competitive environment. It will provide outlook for 2016, and investors will be eager to hear how it plans to deal with TV, landline and Internet rival Shaw Communications, which is adding a wireless business. Oil sands developer Cenovus Energy Inc is expected to report a smaller fourth-quarter loss as lower costs mitigate the impact of low crude prices. The company has clamped down on spending, deferring projects and limiting drilling in response to a more than 70 percent fall in oil prices since June 2014. Investors will want to know if it plans to slash its dividend further, after a 40 percent cut in October. TMX Group, the owner of Canada's biggest stock exchange, reports fourth-quarter earnings. Analysts are expecting flat profit and revenue as the exchange struggles to deal with stubbornly low commodity prices that have hurt its large portion of resource-based issuers. Canadian miner Teck Resources is expected to report weaker fourth-quarter earnings due to lower coal, copper and zinc prices. The markets are likely to focus on the Vancouver-based miner's heavy debt and its plans on how to reduce it. The company may also announce more cost-cutting measures. Precision Drilling Corp, Canada's largest oil and gas rig contractor, is expected to report a smaller Q4 loss as cost cuts help offset the impact of waning demand. A steep drop in crude prices has prompted the company's customers to scale back drilling. Investors will focus on the company's spending plans for the year. Chile's central bank meets to decide the benchmark interest rate. The bank has guided towards a gradual tightening as it looks to fight above target inflation, but analysts think a hold is likely in February given recent weak economic data. (1600/2100) In Mexico, the National Statistics Institute will release December industrial production numbers, after the gauge shrank by the most in six months in November. (0900/1400) LIVECHAT-U.S. RETAIL WATCH with analyst Jharonne Martis As U.S. department stores report quarterly results that included a dreary Christmas, Thomson Reuters retail analyst Jharonne Martis sums up the numbers and takes a data-driven look at the financial foundations, values and investment risks at Macy's and other traditional retailers that may be increasingly ripe for consolidation. (1000 ET/1500 GMT) To participate in the Global Markets Forum, click here bit.ly/1kTxdKD (Compiled by Astha Rawat in Bengaluru; Editing by Don Sebastian)
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