Recessions don't kill business models. They validate them.
This past week of earnings reports rewarded the market darlings at a time when even they felt vulnerable.
- Analysts figured that Apple
(Nasdaq: AAPL) would post a year-over-year decline in profitability. It delivered robust growth instead. -
Chipotle Mexican Grill
(NYSE: CMG) (NYSE: CMG-B) came through with a hearty 45% spike in earnings growth, as the burrito roller posted the healthiest profit margins in its history. -
Netflix
(Nasdaq: NFLX) closed out its latest quarter with nearly 300,000 more subscribers, raising its full-year guidance along the way.
There were some duds along the way, naturally. These were three brutal months for the world's economy. However, investors who arm their portfolios with companies that are thriving in this environment -- as long as the valuations are reasonable -- will be sitting pretty when things turn around elsewhere.
Briefly in the news
And now let's take a quick look at some of the other stories that shaped our week.
- You know something's wrong when even McDonald's
(NYSE: MCD) is going the wrong way. The burger giant's second-quarter revenue and earnings fell 7% and 8%, respectively. Thankfully, the top-line slide is simply the handiwork of a stronger dollar. Comps actually rose, globally. Currency translations affected the bottom line, too. In short, don't bail on the golden arches just yet. - If you can't beat 'em, buy them out. Amazon.com
(Nasdaq: AMZN) is buying popular online footwear retailer Zappos in an all-stock deal. Amazon sells shoes. It even launched a stand-alone site called Endless.com that specializes in high-end footwear and handbags. However, it clearly is no Zappos, so Amazon is turning an online rival into an ally before it's too late.
Until next week, I remain,
Rick Munarriz
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