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

The major market indexes took a hit last week, but let's not assume that it's all bad news these days.

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

RF Micro Devices (UNKNOWN:RFMD.DL)



Infinera (NASDAQ:INFN)



Level 3 Communications (NYSE:LVLT)






United Parcel Service (NYSE:UPS)



Source: Thomson Reuters.

Clearing the table
Let's start at the top with RF Micro Devices. The maker of high-performance radio frequency solutions isn't expected to post much of a profit this time around, but the projected net income of $0.05 a share would reverse a small deficit from the same quarter a year earlier.

RF Micro Devices got a boost late last month when Oppenheimer analyst Rick Schafer upgraded the chip maker from perform to outperform, slapping an encouraging $7 price target on the shares. Schafer feels that RF Micro's been able to get its smartphone chips into the world's two biggest manufacturers, with Samsung and iPhone devices accounting for as much as 40% of RF Micro's business these days.

Infinera is another company that's moving in the right direction on the bottom line, with an inspiring analyst upgrade last month leading the way. Goldman Sachs -- rightfully bearish on the telecom equipment maker -- removed its sell rating on the stock last month, believing that the stock and gross margins were bottoming out. Now the pros see it posting a smaller loss than it did a year earlier.

Level 3 is another company eyeing a narrower deficit. The voice and data carrier tapped a new CEO earlier this month. It was an internal promotion, as President and COO Jeff Storey will replace outgoing CEO James Crowe.

Level 3 hasn't turned a profit in years, but that streak seemed as if it was going to come to an end just a few months ago. Analysts felt that this would be a nearly breakeven quarter when they were targeting a net loss of just $0.02 a share. The outlook got bleaker as the weeks dragged on. The estimate was calling for a deficit of $0.06 a share two months ago and $0.13 a share just a month ago. In that light, a loss of $0.16 a share isn't every encouraging, but it's a lot less red ink than it was sporting a year earlier.

Baidu is China's leading search engine. A surprising rival emerged on the scene last summer, gaining market share at the expense of everybody else. The good news for Baidu investors is that healthy growth is still there. Wall Street sees double-digit percentage spurts on both ends of the income statement when Baidu reports on Thursday.

Finally, we have UPS delivering quarterly results. Of the five names here, UPS is the most likely to post a year-over-year decline. It doesn't help that Wall Street only sees profitability inching a mere 1% higher this time around. The rub at UPS is that it has fallen short in three of the past four quarters. Are consumers holding back on their purchases? Will margins get crushed if fuel surcharges aren't enough to cover pesky overhead increases? We'll know for sure come Thursday.

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.

Longtime Fool contributor Rick Munarriz has no position in any stocks mentioned. The Motley Fool recommends Baidu, Infinera, and United Parcel Service. The Motley Fool owns shares of Baidu and Infinera. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.