5 Reasons Not to Worry This Week

It's not a perfect world out there for investors.

Major market indexes may be near multiyear highs after another quarter of robust capital appreciation, but there are some problematic spots all over the world.

I recently went over some of the companies that are expected to post lower quarterly profits when they report this week.

Thankfully, they're the exceptions and not the rule. Let's go over some publicly traded companies that are expected to stand tall this week by posting year-over-year improvement on the bottom line.

Source: Thomson Reuters.

Clearing the table
Let's start at the top with Yum! Brands.

Despite the hokey corporate name, Yum! Brands owns some of the largest fast-food chains that don't flip burgers. We're talking about Taco Bell and KFC. Yum! Brands also knows how to make some dough with Pizza Hut.

It's true that Yum! Brands did come up short three months ago. It was a rare miss on the bottom line for the PepsiCo spinoff. However, between booming growth for KFC in China and the revival of Taco Bell closer to home, Yum! Brands is in good shape for a strong quarter when it reports tomorrow.

Safeway is the grocery store operator with 1,666 stores throughout the U.S. and western Canada. This is a big business, ringing up $43.6 billion in sales last year.

It's easy for investors to be wary of supermarket chains. There have been bankruptcies and labor tussles in recent years at some of the key players. This summer we saw income investors get burned when the parent company of Albertsons suspended its dividend. Safeway's meaty 4.3% yield seems secure, and growing its profitability as Wall Street expects will keep it that way.

Winnebago is rolling, and not just because it makes houses on wheels. Shares of the RV giant have more than doubled since bottoming out 11 months ago.

Things aren't perfect at Winnebago. Analysts still see a decline in profitability for the fiscal year that ended in August. Winnebago has also badly missed Wall Street profit targets in two of the past three quarters. However, the pros still see it coming up strong in its final quarter for fiscal 2012.

JPMorgan Chase and Wells Fargo are the two banking giants that will kick off the earnings season for the "too big to fail" financial services institutions that will be reporting in the coming days. Both companies report on Friday morning, and the market's holding out for improvement at both bankers.

This has been part of a dramatically improving trend. Just three months ago, Wall Street was banking on a profit of $1.05 a share out of JPMorgan for this quarter, in line with the $1.02 a share that it posted as a quarterly profit a year earlier. However, the analyst average moved up to $1.17 a share a month ago, $1.19 a week ago, and is perched at $1.22 a share right now. That's the direction that investors like to see prognostications going.

The improving sentiment hasn't been as pronounced at Wells Fargo, but profit targets for the acquisitive banker have gone from $0.84 a share three months ago to $0.97 a share now.

Cross those fingers, but know the fundamentals
Investors in these five stocks have a right to be excited. They are all improving their financial situations. They are worthy of the gains that the market rally has bestowed upon them over the past year.

I wouldn't be uncomfortable owning any of these companies. They're doing the right thing, regardless of Mr. Market's mood swings.

The expectations may be high, but these five stocks wouldn't have it any other way.

If you like following winners -- and you probably do since you're reading this article -- a new report singles out three winners in retail. The free research will only be available for a limited time, so check it out now.