In what appears to be a key week for U.S. equity markets, Family Dollar Stores, Inc. (NYSE:FDO), A. Schulman Inc (NASDAQ:SHLM), and Titan Machinery Inc. (NASDAQ:TITN) have scheduled their quarterly earnings this week.

The three companies, in the recent past, have reported increased profitability but all are not worth buying at current levels. Here is why?

Family Dollar, Titan Machinary, A Schulman Logos

North Carolina-based specialty retailer Family Dollar Stores, Inc. (NYSE:FDO) has scheduled its earnings conference call for second quarter on Wednesday, April 10. At the end of November last year, the company operated a chain of more than 7,500 general merchandise retail discount stores in 45 U.S. states.

The company caters primarily to low and middle-income customers. Since a wide majority of the company’s operations are located in the U.S., it stands to benefit from a recovering economy. In fact, this improvement is already visible in the first fiscal quarter ended 24 November 2012.

The company reported a 12.7 percent growth in revenues during the quarter. Margins came under pressure recently as a result of a shift in sales and lower margin consumable merchandise; however, the trend has some seasonality attached to it and is not likely to continue in future.

Growing its top line itself is something of an achievement in these testing times and thus, the stock has recently been upgraded to a “Buy” rating by Deutsche Bank AG (NYSE:DB) (ETR:DBK) with a price target of $71, reflecting a potential upside of 19.9 percent. Meanwhile, the stock continues to trade at attractive valuations which include price earnings ratio of 16.5.  As the company plans to open approximately 500 new stores during the current fiscal, investors can expect to see some traction on the revenues side.

A. Schulman Inc (NASDAQ:SHLM) supplies plastic compounds, resins and services to a diverse group of industrial customers. The stock has come under pressure after its last quarter, which saw the company’s revenues growing 4.5 percent but it was marred by lower operating and net profits.

When the company reports its second quarter results tomorrow, the stock may be buoyed by even half decent results as it is currently trading in the oversold zone. The stock nevertheless is attractive with a dividend yield of nearly 2.6 percent and a price earnings ratio of 18.1.

However, This falls to 12 when higher profits in the coming quarters are taken into account. The high beta nature of this stock is another reason why it may be a good trading bet.

All is not well at Titan Machinery

Unfortunately, all is not well at Titan Machinery Inc. (NASDAQ:TITN). Its stock has seen a constant build up of short interest. The company operates a network of agricultural and construction equipment stores in the country.

Nearly 25 percent of the shares in the market are shorted by investors after losing 8.7 percent over the last month. This comes despite the fact that Titan Machinery’s financial performance in the most recent quarter has been good with revenues growing 38 percent from the same quarter in 2011.

Although profits grew slower at 9.8 percent to $14.06 million, it was still a profitable quarter. While bears are betting on more downside, a profitable quarter could spoil the bear party. This means the stock could be a short squeeze candidate and thus should be traded with caution. Fundamentally speaking, a price earnings ratio of 12.4 and a market to book value ratio of 1.45 in a capital intensive business mean the stock is fairly valued.

Overall, quarterly earnings are set to play crucial roles but care should be taken in case of A. Schulman Inc (NASDAQ:SHLM) and Titan Machinery Inc. (NASDAQ:TITN) which are giving conflicting signals.