Leigh Drogen

About the Author Leigh Drogen

Leigh Drogen is the Founder and CEO of Estimize. Estimize is an open financial estimates platform which facilitates the aggregation of fundamental estimates from independent, buy-side, and sell-side analysts, along with those of industry experts, private investors and students. By sourcing estimates from a diverse community of individuals, Estimize provides both a more accurate and more representative view of expectations compared to sell side only data. Leigh started his career as a quant trader at Geller Capital, a White Plains, NY based fund where he ran strategies that looked at earnings acceleration and analyst estimate revision models, as well as price momentum and several sentiment indicators. Leigh later went on to be the founder of Surfview Capital, a New York based asset management firm that used many of the same strategies as Geller Capital, with a focus on higher beta names on an intermediate term time frame. His educational background includes focus in economics and international relations, specifically war theory. He is a graduate with honors from Hunter College in New York City. You can contact Leigh by emailing him at Leigh@estimize.com

Don’t Get Caught With These Three Stocks Ahead of Earnings Season: Valeant Pharmaceuticals Intl Inc (VRX), Baidu Inc (BIDU), Chipotle Mexican Grill (CMG)

Every quarterly earnings season is filled with both winners and losers. Lately the losers have outpaced the victors, with next season shaping up to be another disappointment. Some of the biggest flops are expected to come from big names including Valeant Pharmaceuticals Intl Inc (NYSE:VRX), Baidu Inc (ADR) (NASDAQ:BIDU) and Chipotle Mexican Grill, Inc. (NYSE:CMG). According to the Estimize data these names are trending downward, owing to negative year-over-year growth estimates, heavy downward revisions and a history of missing expectations. The combination of these factors have typically led to a significant underperformance in the stock.

Valeant Pharmaceuticals Intl Inc

Valeant was one of the best performing stocks on Wall Street in the first half of 2015, but over the past 12 months price gouging initiative have sent shares plunging. After reaching highs of over $250 per share, the stock has plummeted over 90%, to all time lows where it is today.  The ongoing freefall forced management to oust now former CEO Michael Pearson, who led the company through the thick of it’s price hikes. WIth several new board members, one being infamous hedge fund manager Bill Ackman, and a new CEO, Valeant is still fumbling. Its most recent report delivered a nearly 50% decline on the bottom-line and 10% on the top. With no signs of improving anytime soon, the upcoming quarter is shaping up to be another disaster. The Estimize consensus is calling for earnings per share of $1.72 on $2.55 billion in revenue. That projects as a 36% decline on the bottom-line and 8% on the top on a year-over-year basis.

Baidu Inc (ADR)

Investors are slowly losing hope that Baidu will ever come close to Google’s success in the United States. The oft referred to Google of China is coming off of its worst quarterly report in nearly 8 years. Earnings reported a 39% decline from the same period last year while revenue dipped nearly 10% over the same timeframe. Baidu’s struggles in the second quarter were primarily driven by sluggish search advertising revenue. This downturn is expected to carry on through the third quarter and the rest of fiscal 2016. Analysts at Estimize are calling for earnings per share of 96 cents on $2.711 billion in revenue. Compared to a year earlier, this represents a 30% decline on the bottom-line and 6% on the top.

Chipotle Mexican Grill, Inc.

Chipotle is still having trouble getting out from under the numerous health outbreaks starting in late 2015. The burrito chain which was once heavily praised as revolutionizing the fast casual sector is now largely an afterthought to a catalogue of other food chains, one being Shake Shack. Amidst the turmoil, earnings and traffic trends have taken a dramatic downturn. Last quarter comparable restaurant sales decreased a 3.6% on a 16.6% decline in total revenue. In an effort to regain customers, Chipotle has hit the ground running with new promotional campaigns and marketing initiatives. Some of these include Chiptopia which rewards customers for frequent visits throughout the summer. More recently, the company launched free kid’s meals on Sundays and complimentary beverages for students. While Chipotle continues to win back the hearts of its once loyal customers, investors have hammered the stock. Shares are down 12% year-to-date and 45% in the past 12 months.


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