7 Reasons to Worry About Next Week

It's not going to get any better next week, when several blue chips
and seemingly recession-proof companies are expected to follow suit
with year-over-year declines. Let's go over a few of the companies that
analysts predict will post declines in year-over-year profitability.
Some of the names may surprise you.

Source: Thomson.

Clearing the table

There will likely be
hundreds of companies posting lower earnings next week, but these are
just a few of the names that really jump out at me.

SYSCO provides food to restaurants and institutions. When there's a
recessionary slowdown in casual dining, it's there delivering grub to
the fast food chains. When eateries struggle, SYSCO is also serving up
foodstuffs through all-weather places like hospitals, schools, and
prisons. The company is such a consistent grower that it has hiked its
dividend rate every single year since going public in 1970.

Activision Blizzard is the world's leading video game company. Guitar Hero, World of Warcraft, and Call of Duty
are just some of its enviable franchises. The video game industry has
mostly bucked the recessionary trend, with software sales growing as
console makers continue to lower their system prices.

Bankrate may seem like a name that is susceptible given the banking
industry's failure, but the online publisher of interest rates has been
growing nicely until now. Revenue soared 59% in the company's previous quarter. However, earnings haven't kept up lately. Mr. Market thinks it's going to get worse.

Sara Lee and CVS should be surprising names on the list. Grocery
store staples and drugstore chains are typically seen as defensive
stocks. If the economy is bad, we still need to eat and pick up
pharmacy prescriptions and sundries.

Disney is another shocker. Yes, media companies are struggling. The
advertising market is being hammered. However, Disney has pre-teen
magnets in its arsenal like Jonas Brothers, Hannah Montana, and the
rising star duo of Selena Gomez and Demi Lovato. It also has cable
properties like Disney Channel -- and to a lesser extent ESPN -- that
aren't as sponsor-dependent as free broadcast channels.

When Pitney Bowes bumped up its yield
back in February, shareholders weren't surprised. The metered mail
leader has increased its payout in each of the past 27 years. However,
clearly corporate America's slowdown is finally catching up to Pitney
Bowes, if the market has "return to sender" stamped on next week's
earnings report.  

Shield your eyes, but do take snapshots

So
how confident are you feeling about the market extending its recent
rally through next week? If all-weather stocks are buttoning up their
raincoats, shouldn't you start unfolding your poncho?

Then again, the market has already baked in a disappointing quarter
for many of these companies. Sure, most stocks have been rallying since
early March but they are mostly trading lower today than they were a
year ago.

Analysts have also underestimated
the profit-generating potential of several companies earlier this
earnings season. January, February, and March were definitely difficult
months for companies, but many of them saw this coming and began to
scale back their expenses accordingly.

Am I happy to see so many top stocks poised to take a step back next
week? Of course not. Might any potential weakness prove to be overdone,
providing investors with perhaps the last great entry points into many
of these stocks? I would bet on it.

Some other reads to get you through the weekend:

• 3 Reasons Why the Dow Won't Hit 5,000
• 7 Stocks That Should Soar This Month
• You're All Hypocrites
• © 2009 UCLICK, L.L.C.