Why Caesarstone, Kforce, and Trimble Navigation Are Today's 3 Best Stocks

Watch stocks you care about

The single, easiest way to keep track of all the stocks that matter...

Your own personalized stock watchlist!

It's a 100% FREE Motley Fool service...

Click Here Now

Although we don't believe in timing the market or panicking over market movements, we do like to keep an eye on big changes -- just in case they're material to our investing thesis.

Following four straight days of strong gains, the broad-based S&P 500  (SNPINDEX: ^GSPC  ) appeared to take a breather today after unimpressive economic data failed to outweigh a slew of earnings reports, and pushed the markets lower.

Specifically, investors seemed to focus on a weak loan originations report from the Mortgage Brokers Association. The weekly report showed a 2% week-over-week decline in originations, which is concerning given that lending rates are still historically low, and that originations rose 0.4% last week. On the other hand, fluctuations in this figure aren't uncommon. But, considering that loan originations hit a nearly two-decade low in December despite a 4%, 30-year mortgage rate, this decline should give homebuilders and banks cause for concern.

The release of the Treasury Budget for January also failed to excite investors. Although the deficit of $10.4 billion was right in line with estimates, and down nearly 37% from the prior year, it reversed a surplus of $2.9 billion in the prior month, and points to plenty of work left to be done by Congress to reduce federal spending and the deficit. Given Congress' inability to work together during the past couple of years, this deficit serves as a worrisome reminder for investors.

By day's end, the S&P 500 had broken its four-day winning streak, and fallen modestly by 0.49 points (-0.03%), to close at 1,819.26.

Topping the charts and leading all companies to the upside, was quartz-countertop maker Caesarstone Sdot-Yam (NASDAQ: CSTE  ) , which gained 19.6% after the company reported better-than-expected fourth-quarter results. For the fourth quarter, Caesarstone reported a 27% increase in revenue to a record $96.8 million (and that includes a nearly 3% negative effect from foreign currency translation), as net income jumped 58%, to $0.48 per share. By comparison, Wall Street had expected Caesarstone to report revenue of just $87.6 million on $0.40 in EPS. Overall, Caesarstone announced partnerships with all U.S.-based IKEA stores to supply them with quartz countertops, and saw its margin expand 120 basis points, to 43%. Furthermore, Caesarstone now anticipates fiscal 2014 full-year revenue of $410 million-$420 million, which perfectly brackets the $412.1 million estimate of Wall Street.

The story was very similar for professional and technical staffing solutions company Kforce (NASDAQ: KFRC  ) , which advanced 14.1% after reporting its fourth-quarter results, and guiding its first-quarter revenue and EPS well ahead of the Street's current consensus estimates. For the quarter, Kforce's revenue improved 12%, to $302.9 million, as net income inched ever-so-slightly higher to $0.28, from $0.27 in the prior year. Kforce's CEO David Dunkel notes that Tech Flex provided the biggest boost to Kforce, with revenue up 18.3% year over year. What really excited investors, though, was the company's first-quarter guidance of $298 million-$304 million in revenue, and $0.15-$0.18 in EPS. Comparatively speaking, Wall Street analysts expected Kforce to report $292.6 million in revenue and $0.15 in EPS for the first-quarter. As for me, I'd still suggest approaching Kforce cautiously, as its top-line growth isn't translating par-for-par with its earnings growth, which could be a worrisome sign that Kforce's costs aren't under control.

Finally -- and keeping our theme of strong earnings reports driving big gains today -- position products developer Trimble Navigation (NASDAQ: TRMB  ) tacked on 14% after reporting better-than-expected fourth-quarter results. For the quarter Trimble delivered a 16% increase in year-over-year revenue, to $599.2 million, as adjusted EPS expanded to $0.43, from $0.28. Both results were clearly ahead of expectations that had called for just $0.36 in adjusted EPS on $567.4 million in revenue. Although the company's results demonstrate a better mix of higher-margin product sales, Trimble's CEO Steven Berglund noted that the company's growth in certain regions still remains uncertain. Following today's pop, I believe those cautious words should be enough to keep shareholders safely on the sidelines.

Tired of not seeing your stocks among the day's top gainers? Perhaps you aren't thinking far enough outside the box!
They said it couldn't be done. But David Gardner has proved them wrong, time, and time, and time again, with stock returns like 926%, 2,239%, and 4,371%. In fact, just recently, one of his favorite stocks became a 100-bagger. And he's ready to do it again. You can uncover his scientific approach to crushing the market and his carefully chosen six picks for ultimate growth instantly, because he's making this premium report free for you today. Click here now for access.

Read/Post Comments (0) | Recommend This Article (1)

Comments from our Foolish Readers

Help us keep this a respectfully Foolish area! This is a place for our readers to discuss, debate, and learn more about the Foolish investing topic you read about above. Help us keep it clean and safe. If you believe a comment is abusive or otherwise violates our Fool's Rules, please report it via the Report this Comment Report this Comment icon found on every comment.

Be the first one to comment on this article.

Sponsored Links

Leaked: Apple's Next Smart Device
(Warning, it may shock you)
The secret is out... experts are predicting 458 million of these types of devices will be sold per year. 1 hyper-growth company stands to rake in maximum profit - and it's NOT Apple. Show me Apple's new smart gizmo!

DocumentId: 2837040, ~/Articles/ArticleHandler.aspx, 8/28/2015 1:09:14 AM

Report This Comment

Use this area to report a comment that you believe is in violation of the community guidelines. Our team will review the entry and take any appropriate action.

Sending report...

Sean Williams

A Fool since 2010, and a graduate from UC San Diego with a B.A. in Economics, Sean specializes in the healthcare sector and in investment planning topics. You'll usually find him writing about Obamacare, marijuana, developing drugs, diagnostics, and medical devices, Social Security, taxes, or any number of other macroeconomic issues.

Today's Market

updated 3 hours ago Sponsored by:
DOW 16,654.77 369.26 2.27%
S&P 500 1,987.66 47.15 2.43%
NASD 4,812.71 115.17 2.45%

Create My Watchlist

Go to My Watchlist

You don't seem to be following any stocks yet!

Better investing starts with a watchlist. Now you can create a personalized watchlist and get immediate access to the personalized information you need to make successful investing decisions.

Data delayed up to 5 minutes

Related Tickers

8/27/2015 4:35 PM
^GSPC $1987.66 Up +47.15 +2.43%
S&P 500 INDEX CAPS Rating: No stars
CSTE $40.62 Up +1.57 +4.02%
Caesarstone CAPS Rating: ****
KFRC $26.55 Down -0.06 -0.23%
Kforce, Inc. CAPS Rating: ***
TRMB $18.59 Up +0.39 +2.14%
Trimble Navigation… CAPS Rating: ****