Recent earnings misses have worried Wall Street as well-known names such as Google and Apple have failed to meet expectations. However, in the past week, many companies have reported positive results revealing that they are not only meeting expectations but that they are thriving. In the list below I have focused on some of the better known names with good performance and reasonable valuations that have raised their outlooks for the current year.
Moody's Corporation
Moody's Corporation (MCO, Financial) beat analyst forecasts on Friday when it reported diluted earnings per share of $0.81. Excluding a once off tax item, diluted earnings per share were $0.75 up 32% from the prior-year period. At the same time Moody's raised its EPS guidance for the full year 2012 to a range of $2.95 to $3.05 from the previous range of $2.76 to $2.86. The company announced that it expected revenue to grow in the mid-teens percent range with a full-year operating margin now projected to be approximately 40 percent.
Trading on a multiple of 17.3 times historic earnings appears low for a company that has reported double-digit annual EPS growth and growth of over 40% for the last quarter. Yahoo Finance reports average annual consensus earnings growth of 14.4% for the next five years.
Hershey Company
The Hershey Company (HSY, Financial) on Friday announced sales and earnings for the third quarter ended Sept. 30, 2012. Excluding net pre-tax charges and non-service-related pension expense, the adjusted earnings were $199.5 million, or $0.87 per share diluted, in the third quarter of 2012, compared with $194 million, or $0.84 per share-diluted, in the third quarter of 2011, an increase of 3.6 percent.
The company reported that it expected adjusted earnings per share diluted for the full-year to be in the $3.22 to $3.25 range, an increase of 14 to 15 percent versus 2011, greater than the previous estimate of a 12 to 14 percent increase. The boost comes as input costs are now expected to increase by less in 2012 than previously estimated. As a result, adjusted gross margin is now expected to increase 120 to 140 basis points (previous forecast of about a 100 to 120 basis points).
Tupperware Brands
On Wednesday Tupperware Brands (TUP, Financial) reported net income for the quarter of $47.5 million, or $0.85 per diluted share, compared with 2011 third quarter GAAP net income and EPS of $10.5 million and $0.17 per share, respectively, which included a non-cash impairment charge of $36.1 million or $0.60 per share. Adjusted diluted earnings per share of $0.95 in the quarter was $0.12, or 14% better than 2011.
The company raised the high end of its full year diluted earnings per share guidance range, excluding items, by 8 cents versus the guidance range provided in July, of which 7 cents was due to the impact of stronger foreign exchange rates. EPS excluding items for 52 weeks ending December 2012 is now projected to be $4.94 to $4.99 compared to $4.45 for 53 weeks ending December 2011. The stock was trading on a multiple of 16.2 times earnings as of the Oct. 26 close.
Cerner
Cerner (CERN, Financial), the health and care information technology company, announced a 25% increase in earnings as adjusted diluted earnings per share were $0.60 in the third quarter of 2012 compared to $0.48 of adjusted diluted earnings per share in the year-ago quarter. At the same time the company announced that it expected full year 2012 adjusted diluted earnings per share before share based compensation expense between $2.34 and $2.36, up from a prior range of $2.32 to $2.36.
Risk Disclaimer: This article does not constitute a recommendation to buy or sell. Investing in stocks or other securities and derivatives is a high risk activity and not suitable for everyone. It is strongly recommended that individuals should consult with an SEC-registered investment adviser prior to making any investment decisions.
Disclosure: The author holds no positions in Moody's, Hershey, Tupperware Brands or Cerner and has no intention to initiate any in the next 72 hours.
Moody's Corporation
Moody's Corporation (MCO, Financial) beat analyst forecasts on Friday when it reported diluted earnings per share of $0.81. Excluding a once off tax item, diluted earnings per share were $0.75 up 32% from the prior-year period. At the same time Moody's raised its EPS guidance for the full year 2012 to a range of $2.95 to $3.05 from the previous range of $2.76 to $2.86. The company announced that it expected revenue to grow in the mid-teens percent range with a full-year operating margin now projected to be approximately 40 percent.
Trading on a multiple of 17.3 times historic earnings appears low for a company that has reported double-digit annual EPS growth and growth of over 40% for the last quarter. Yahoo Finance reports average annual consensus earnings growth of 14.4% for the next five years.
Hershey Company
The Hershey Company (HSY, Financial) on Friday announced sales and earnings for the third quarter ended Sept. 30, 2012. Excluding net pre-tax charges and non-service-related pension expense, the adjusted earnings were $199.5 million, or $0.87 per share diluted, in the third quarter of 2012, compared with $194 million, or $0.84 per share-diluted, in the third quarter of 2011, an increase of 3.6 percent.
The company reported that it expected adjusted earnings per share diluted for the full-year to be in the $3.22 to $3.25 range, an increase of 14 to 15 percent versus 2011, greater than the previous estimate of a 12 to 14 percent increase. The boost comes as input costs are now expected to increase by less in 2012 than previously estimated. As a result, adjusted gross margin is now expected to increase 120 to 140 basis points (previous forecast of about a 100 to 120 basis points).
Tupperware Brands
On Wednesday Tupperware Brands (TUP, Financial) reported net income for the quarter of $47.5 million, or $0.85 per diluted share, compared with 2011 third quarter GAAP net income and EPS of $10.5 million and $0.17 per share, respectively, which included a non-cash impairment charge of $36.1 million or $0.60 per share. Adjusted diluted earnings per share of $0.95 in the quarter was $0.12, or 14% better than 2011.
The company raised the high end of its full year diluted earnings per share guidance range, excluding items, by 8 cents versus the guidance range provided in July, of which 7 cents was due to the impact of stronger foreign exchange rates. EPS excluding items for 52 weeks ending December 2012 is now projected to be $4.94 to $4.99 compared to $4.45 for 53 weeks ending December 2011. The stock was trading on a multiple of 16.2 times earnings as of the Oct. 26 close.
Cerner
Cerner (CERN, Financial), the health and care information technology company, announced a 25% increase in earnings as adjusted diluted earnings per share were $0.60 in the third quarter of 2012 compared to $0.48 of adjusted diluted earnings per share in the year-ago quarter. At the same time the company announced that it expected full year 2012 adjusted diluted earnings per share before share based compensation expense between $2.34 and $2.36, up from a prior range of $2.32 to $2.36.
Risk Disclaimer: This article does not constitute a recommendation to buy or sell. Investing in stocks or other securities and derivatives is a high risk activity and not suitable for everyone. It is strongly recommended that individuals should consult with an SEC-registered investment adviser prior to making any investment decisions.
Disclosure: The author holds no positions in Moody's, Hershey, Tupperware Brands or Cerner and has no intention to initiate any in the next 72 hours.
