Earnings season is winding down, but we still have a lot of big names reporting this week.
Last Friday, I pointed out seven bellwethers that analysts see posting lower quarterly profits this week. But there is joy in Mudville. Several applause-worthy standouts are growing in this dicey climate.
Since I played up the pessimism over the weekend, let me come right back with a dash of optimism. Here are seven companies that analysts see posting healthier bottom lines this week.
|
Company
|
Latest Quarter's EPS (Estimated)
|
Year-Ago Quarter's EPS
|
|
Electronic Arts (Nasdaq: ERTS)
|
$0.07
|
($0.06)
|
|
MBIA (NYSE: MBI)
|
($1.05)
|
($2.22)
|
|
Rackspace (NYSE: RAX)
|
$0.07
|
$0.04
|
|
Ctrip.com (Nasdaq: CTRP)
|
$0.31
|
$0.22
|
|
Dendreon (Nasdaq: DNDN)
|
($0.19)
|
($0.29)
|
|
Green Mountain Coffee Roasters (Nasdaq: GMCR)
|
$0.33
|
$0.19
|
|
Wal-Mart (NYSE: WMT)
|
$0.81
|
$0.77
|
Source: Yahoo! Finance.
Clearing the table
Let's start at the top. Electronic Arts is in an industry funk. Video game hardware and software sales have fallen in six of the seven previous months. EA has struggled with many of its in-house releases lately, but it probably reaped the benefits of being the third-party distributor for The Beatles: Rock Band, which was released during the last month of the company's quarter. The pros think those benefits will show through, and that EA will replace last year's deficit with a modest profit.
MBIA was one of the earliest casualties in the financial-services meltdown. Insuring municipal bonds was definitely not the place to be when financial fault lines began to swallow entities whole. MBIA isn't back in the black, but at least it's delivering narrower losses.
Rackspace is a leading provider of online hosting. As big and small companies move to beef up their online presence, Rackspace is there with its time-tested farm of servers. The company is also a popular host for cloud-computing apps. They don't pay as much as traditional Web hosting accounts do, but they're still incremental -- and more than a little sexy these days.
Ctrip.com is China's leading online travel portal. The Chinese economy has held up better than those in most countries, and growing discretionary income makes leisure and corporate travel a no-brainer area for growth investors to explore.
Dendreon is a biotech with a promising vaccine for prostate-cancer patients. The company is still posting losses -- albeit narrower than last year -- but an FDA nod as early as next year would be a transformative event for the company.
Green Mountain Coffee Roasters is the company behind the Keurig single-cup coffee maker. With a growing fleet of bean companies making K-Cup portion packs and even third-party appliance makers rolling out java machines that are fueled by Green Mountain's premium K-Cups, the company has been one of the recession's biggest success stories.
Finally, we have Wal-Mart. The world's largest retailer also happens to be a discount department-store chain. That distinction has clearly helped during the downturn, as shoppers from ritzier full-priced chains have been trading down to get more bang for their buck.
Cross those fingers, but know the fundamentals
These aren't the only companies expected to post year-over-year gains this week. Several companies have either found ways to grow during the recession or have simply cut enough corners to show improvement on the bottom line.
Not that investors can rest easy. The bad news is that these companies are expected to post improving results. Since the optimism is already baked into their share prices, the companies will have an easier time slipping. But why begin worrying about the companies that we aren't supposed to be worrying about?
If analysts are doing a good job modeling their profit targets, we'll be just fine.
Some other reads to get you through the week:
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