Earnings Preview: Tiffany and Co, Royal Bank, Madison Square Garden

Earnings reports are significant events for every stock. Not only does management tell investors what has been happening in the business over the past 90 days, but most companies also give updated guidance concerning the next quarter and/or fiscal year. Analysts and institutional investors pay keen attention to these reports and management commentary and it is common for stocks to experience large percentage moves on higher-than-normal value.

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Investors should certainly prepare themselves for earnings season by reviewing the expectations and recent performance of stocks held in their portfolios. That said, be cautious about buying or selling into earnings - investor reactions to earnings reports can be sharp and disproportionate and an unlucky buy order can turn into a 10% loss very quickly. (Learn more about earnings reports, see How To Decode A Company's Earnings Reports.)

Companies Releasing Earnings on August 26

Company	Earnings Date	EPS Estimate
Tiffany and Co (TIF)	08/26/11	$0.70
The Madison Square Garden Co (MSG)	08/26/11	$0.14
Royal Bank of Canada (RY)	08/26/11	$1.12

The Announcement Is Only the Beginning
Wise investors do not simply read an earnings press release and move on to the next piece of business. Given that press releases can be lacking in detail and slanted towards management's intended viewpoint, it is important to go deeper. Specifically, investors would do well to listen to management's conference call concerning earnings (almost every company has one, and they are usually available as a recording for many weeks afterwards) and carefully review the company's 10-Q or 10-K when available. (For related reading, see Pick Better Stocks By Consulting Form 10-K.)

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