My Distant Early Warning List

We are smack in the middle of earnings season and many are breathing a sigh of relief that their favorite long holdings did not preannounce an earnings miss.  But before you get too comfortable, let's take a second look at the riskiest large-cap names about to report. Although a lack of preannouncement usually indicates clear sailing, obviously the forward guidance or other metrics can torpedo a stock.

In order to get a read on possible dangers, I compile a distant early warning list by looking at recent changes in analysts' consensus EPS estimates. Where estimates are being ratcheted down significantly, I take a closer look to understand why the consensus may be turning against a company. Analyst channel checks" and other last minute research will inevitably flow into minor tweaks to estimates. On the margin -- which is all that ever matters -- negative data points can be indicating a change in trend or other dangers lurking before the earnings report....218 more words left in this article. To read them, just click below and try Real Money FREE for 14 days.

Read the full story and get access to the Real Money Pro trading floor.

There’s no substitute for a trading floor to get great ideas, so Jim Cramer created a better one at Real Money and blogs there exclusively. We then added legendary hedge fund manager, Doug Kass, with his exclusive Daily Diary and best investing ideas. Staffed with more than 4 dozen investing pros, money managers, journalists and analysts, Real Money Pro gives you a flood of opinions, analysis and actionable trading advice found nowhere else, and allows you to interact directly with each expert.

Already a Subscriber? Please login.

Except as otherwise indicated, quotes are delayed. Quotes delayed at least 20 minutes for all exchanges. Market Data provided by Interactive Data. Company fundamental data provided by Morningstar. Earnings and ratings provided by Zacks. Mutual fund data provided by Valueline. ETF data provided by Lipper. Powered and implemented by Interactive Data Managed Solutions.

TheStreet Ratings updates stock ratings daily. However, if no rating change occurs, the data on this page does not update. The data does update after 90 days if no rating change occurs within that time period.

IDC calculates the Market Cap for the basic symbol to include common shares only. Year-to-date mutual fund returns are calculated on a monthly basis by Value Line and posted mid-month.