For the current quarter, management provided guidance of “high teens” revenue growth for Media. Revenue at ValueClick Inc (NASDAQ:VCLK) has grown 25% in the last 12 months, while earnings have grown only 7%. I expect earnings growth to accelerate in coming quarters, as evidenced by the improved 38.6% operating margin during Q4 2012 (34.8% prior year).
Wall Street is optimistic ahead of Tuesday’s results. Analysts at Jefferies raised the stock to “buy” from “hold” with a new $35 price target based on the long-term secular growth story. Needham & Company also raised their price target to $34 in recent months.
While not a direct corollary, Facebook Inc (NASDAQ:FB) reported strong growth in mobile advertising during its Q1 results on May 1. Advertising revenue grew 43% year-over-year during the first quarter. I believe this bodes well for ValueClick Inc (NASDAQ:VCLK)’s upcoming earnings, as businesses expand to the latter’s display advertising and mobile offerings.
The Walt Disney Company (NYSE:DIS) gained the attention of Wall Street when Robert Downey Jr., the actor who plays Iron Man’s Tony Stark, rang the opening bell of the New York Stock Exchange on April 30 along with executives from Marvel Entertainment.
Shares of The Walt Disney Company (NYSE:DIS) are reaching fresh all-time highs in early May, in possible recognition of Iron Man 3’s opening weekend in the United States. The Walt Disney Company (NYSE:DIS) also received approval to release the new film in China during the same May 3 weekend, in order to step in front of pirates who hope to illegally distribute the movie overseas following the U.S. release.
I wrote positively on The Walt Disney Company (NYSE:DIS) back on Dec. 3 with my editorial Disney Renews Shareholder Commitment, Remains Strong Buy, discussing CEO Bob Iger’s purchase of Lucasfilm, owner of the Star Wars brand and my personal favorite Indiana Jones (among others). At the time, The Walt Disney Company (NYSE:DIS) management received criticism from the acquisition. Fast forward to present time, and the stock has rallied from beneath $50 to greater than $63 per share.
All in all, everything seems to be going right at The Walt Disney Company (NYSE:DIS), including its strong television franchises and profitable theme parks. ESPN received high viewership for its NFL draft coverage. Disney Junior has also unseated Nick Jr. (Viacom, Inc. (NASDAQ:VIAB)) as the leader on cable television for preschool children, based on preference for Sofia the First over Dora the Explorer.
Ahead of Tuesday’s upcoming earnings release, analysts at UBS upgraded Disney to “buy” from “neutral” with a new $72 price target. The Swiss investment firm cited increased profits from reverse compensation, retransmission consent, expanding margins at theme parks, and benefits from the Lucasfilm acquisition.
I continue to view Disney positively, and the company has a full movie schedule going out to 2015 including Thor, Captain America, Avengers 2, and Star Wars 7, which is likely to be a blockbuster.
Thanks for reading, and consider subscribing to my posts for more Foolish ideas on outperforming the market.
The article 3 Overlooked Stocks to Buy Ahead of Earnings originally appeared on Fool.com is written by John Macris.
Copyright © 1995 – 2013 The Motley Fool, LLC. All rights reserved. The Motley Fool has a disclosure policy.
