I'm Loving It

McDonald’s Corporation

Q2 Rev Est.:  $5.95 Bil

Q2 EPS Est.:  $1.12

On average, analysts are expecting second-quarter revenue for McDonald’s Corporation (“MCD”) to come in at $5.90 Bil with earnings of $1.12 per share.  While my revenue estimate slightly tops analysts’ consensus, our EPS figures are equal.  YUM Brand’s earnings announcement on Tuesday should be a good indicator for the overall strength of the fast-food industry.  It is important to note that while the DJI has been slightly negative year-to-date, shares of MCD have improved more than 10%.  If either my top-line or bottom-line estimates turn out to be too optimistic, shares of the restaurant giant would most likely fall sharply.  Given that my estimates are virtually even with consensus, I will not be giving a Trading Recommendation on the stock. 

Income Statement
For the three months ended June 30, 2010
Total Revenues	$5,953
Operating Costs:
Restaurant Ex	$3,293
Occupancy Ex	$353
SG&A	$560
Impairment	$33
Other	-$97
Total Oper. Costs	$4,143
Operating Income	$1,810
Interest Ex	$117
Nonoperating Ex	$0
EBT	$1,693
Taxes	$508
Net Income	$1,185
Adj:  Impairment	$33
Adjusted Net Income	$1,218
Diluted EPS	$1.12

Trading Recommendation: NONE

For more on what a “Trading Recommendation” means, please click HERE.

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MCD Ownership

Author:   NO

Author’s Family:  NO

Disclaimer:
· Opinions, estimates and projections contained in this report are of the author as of the date published and are subject to change without notice.
· This report is not, nor should it be construed as, an offer to sell or solicitation of an offer to buy any securities.
· Unless otherwise noted, all research reports provide information of a general nature and do not address the circumstances of any particular investor.

· It is important to do your own due diligence on any position you enter.

Another Successful Trading Recommendation

Quick Update on Family Dollar:

Yesterday, Family Dollar Stores ("FDO") reported earnings that disappointed the Street. For my readers and followers, this was not a surprise. Early Tuesday, July 6th, I wrote the following:

FDO shares have risen nearly 40% since the start of the year. If estimates do come in below analysts’ consensus as I anticipate, shares should fall quite precipitously.

I also gave a Trading Recommendation on the stock--Buy Puts. The day after the earnings announcement (Wednesday), shares closed with an 8.22% drop. On Tuesday just before the close, I actually followed my own advice and bought August puts, which I sold the next day for an 80%+ gain.

So far this earnings season I have given my readers correct Trading Recommendations on both Research in Motion ("RIMM") and FDO. RIMM fell 10.84% the day after its announcement and FDO dropped 8.22%. Monday, July 12th, marks the official beginning of the season. Estimates and recommendations have already been posted for companies like AT&T, UPS, CSX, Seagate Technology, United Healthgroup, IBM, Intel, Google, Exxon Mobil, and Hewlett-Packard.

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Disclaimer:
· At the time of publication, I do not have any open positions.
· Opinions, estimates and projections contained in this report are of the author as of the date published and are subject to change without notice.
· This report is not, nor should it be construed as, an offer to sell or solicitation of an offer to buy any securities.
· Unless otherwise noted, all research reports provide information of a general nature and do not address the circumstances of any particular investor.
· It is important to do your own due diligence on any position you enter.

Dollar Stores & Health Care

Family Dollar Stores, Inc

Q3 Rev Est.:  $1.97 Bil

Q3 EPS Est.:  $0.73

On average, analysts are expecting second-quarter revenue for Family Dollar Stores (“FDO”) to come in at $2.00 Bil with earnings of $0.76 per share.  Both of these figures are higher than my estimates of $1.97 Bil in revenue and $0.73 in earnings.  FDO shares have risen nearly 40% since the start of the year.  If estimates do come in below analysts’ consensus as I anticipate, shares should fall quite precipitously.

Income Statement
For the three months ended May 29, 2010
Net Sales	$1,971,506
Costs & Expenses:
Cost of Sales	$1,270,301
SG&A	$542,164
Costs & Ex Total	$1,812,465
Operating Profit	$159,041
Interest Income	$227
Interest Expense	$3,395
EBT	$155,873
Taxes	$56,315
Net Income	$99,559
Diluted EPS	$0.73

Trading Recommendation:  Buy Puts

For more on what a “Trading Recommendation” means, please click HERE.

Unitedhealth Group, Inc

Q2 Rev Est.:  $23.26 Bil

Q2 EPS Est.:  $0.87

On average, analysts are expecting $22.94 Bil in fourth-quarter revenue for Unitedhealth Group (“UNH”) with earnings of $0.74 per share.  These figures are below both my revenue and EPS estimates of $23.26 Bil and $0.87, respectively.  Currently, UNH shares have dropped about 7% since the beginning of the year.  If the stock continues to remain weak through the first half of July, shares could see a nice jump upward immediately following the earnings announcement on July 20.  

Income Statement
For the three months ended June 30, 2010
Total Revenue	$23,263
Operating Expenses:
Medical Costs	$17,324
Operating Costs	$3,469
Cost of Products Sold	$474
Depreciation	$261
Total Oper. Ex.	$21,527
Earnings from Operations	$1,735
Interest Ex.	-$142
EBT	$1,593
Taxes	-$590
Net Earnings	$1,004
Diluted EPS	$0.87

Trading Recommendation:  Buy Calls

For more on what a “Trading Recommendation” means, please click HERE.

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FDO/UNH Ownership

Author:   NO

Author’s Family:  NO

Disclaimer:
· Opinions, estimates and projections contained in this report are of the author as of the date published and are subject to change without notice.
· This report is not, nor should it be construed as, an offer to sell or solicitation of an offer to buy any securities.
· Unless otherwise noted, all research reports provide information of a general nature and do not address the circumstances of any particular investor.

· It is important to do your own due diligence on any position you enter.