It's not a perfect world out there for investors, but things may be starting to get better.

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.


Latest-Quarter EPS (Estimated)

Year-Ago Quarter EPS

My Watchlist

Toll Brothers (NYSE:TOL)




Francesca's Holdings (OTC:FRAN)




Vera Bradley (NASDAQ:VRA)




Smith & Wesson (NASDAQ:SWBI)




Titan Machinery (NASDAQ:TITN)




Source: Thomson Reuters.

Clearing the table
Let's start at the top with Toll Brothers.

Homebuilders have bounced back in a major way. Toll Brothers has seen its shares soar 56% so far this year, and it's easy to see why. Home prices are moving higher. The glut of existing homes that was siphoning demand from new residential construction has eased.

Analysts have been slow to catch on to the turnaround. Toll Brothers is a prolific bellwether for the industry. It builds higher-end homes, largely in suburban developments. Despite all of the attention and coverage that Toll Brothers attracts, Wall Street apparently didn't get the forwarding address. Toll Brothers has earned more than twice as much as what analysts were forecasting in each of its two previous quarters. It's a welcome trend to notice as we knock ahead of tomorrow's quarterly report. Wall Street may seem to be aggressive in expecting profitability to nearly triple, but the trend suggests that Toll Brothers will earn even more than that.

Francesca's Holdings runs a fast-growing chain of stylish boutiques.

Francesca's follows what it calls a "deep but shallow" stocking philosophy. It will carry plenty of different items in its smallish stores, but only a very limited amount of each item. This approach achieves three things for the company. For starters, it gives shoppers comfort in knowing that they won't be showing up to a party where everyone is wearing the same outfit. The limited availability of items also encourages repeat visits, because the apparel items are always changing. Finally, it stirs a sense of urgency when one sees an attractive item. It has to be purchased then, because who knows if it will still be there in a few days.

Well, the approach is working. Analysts see net sales and earnings growing 43% and 57%, respectively.

Vera Bradley is made to travel. The company may be best known for its stylish travel bags and accessories, but the company also applies its colorful fashion sense to everything from housewares to sunglasses.

Vera Bradley went public at $16 in 2010. It was a scorching IPO, more than tripling to $52.36 in May of last year. A few hiccups and a pair of profit misses later, the stock has shed nearly half of its peak value.

Mr. Market's banking on a profit of $0.38 a share when Vera Bradley reports on Wednesday, but it bears noting that the company fell short on the bottom line last time out.

Smith & Wesson makes handguns. It may be a polarizing subject, but let's talk about the business of weaponry here. Some recent prolific shootings and the reelection of President Obama are stirring up the age-old gun-control law debate. This could be problematic for Smith & Wesson in the long run, but a short-term spike in demand for guns is probably going to lead to another market-thumping quarter at Smith & Wesson.

Yes, Smith & Wesson has been a consistent market beater lately. It has blown past analyst income estimates by 55% or better in each of the past four quarters. It gets another chance to blow the market away on Thursday.

Finally, we have Titan Machinery. You won't find this retailer at a suburban mall near a Toll Brothers community. Titan sells and resells agricultural and construction equipment. Wall Street sees a profit of $0.65 a share when Titan reports on Thursday, just ahead of the $0.61 a share it rang up a year earlier.

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.

This article represents the opinion of the writer, who may disagree with the “official” recommendation position of a Motley Fool premium advisory service. We’re motley! Questioning an investing thesis -- even one of our own -- helps us all think critically about investing and make decisions that help us become smarter, happier, and richer.