7 Reasons Not to Worry This Week

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Things aren't always pretty out there.

Last week saw upheaval in Greece and turnover in Italy. I guess it's true, anything can change in a Silvio Berlusconi minute. There have been plenty of implosions this earnings season, and we're probably not done yet.

I recently went over some of the companies posting lower quarterly profits and hosing down their near-term outlooks.

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.

Company

Latest Quarter EPS (estimated)

Year-Ago Quarter EPS

My

Watchlist

Quepasa (ASE: QPSA)

($0.16)

($0.21)

Add

Beazer Homes (NYS: BZH)

($0.37)

($0.81)

Add

Dell (NAS: DELL)

$0.47

$0.45

Add

K12 (NYS: LRN)

$0.23

$0.07

Add

Staples (NAS: SPLS)

$0.47

$0.41

Add

Aruba Networks (NAS: ARUN)

$0.14

$0.12

Add

Dolby Labs (NYS: DLB)

$0.60

$0.57

Add

Source: Thomson Reuters.

Clearing the table
Let's start at the top with Quepasa.

The company behind the small Spanish language namesake social networking site caught a break last week, completing its acquisition of the much larger parent company of myYearbook. The deal should dramatically transform Quepasa's previously ho-hum financials. Investors won't sense the impact in tonight's quarterly report. The merger didn't kick in until the current quarter. However, Quepasa is expected to post a narrower deficit in its most recent outing -- and that's a step in the right direction.

Beazer Homes is another company pegged to post a smaller quarterly loss. Homebuilders have had it rough over the past few years, and one can only imagine how much harder things would be for real estate developers if we weren't seeing historic low mortgage rates.

Dell knows it's not perfect. No one needs to remind the former market darling that it's losing market share in a stagnant pie. Dell knows that PC, laptop, and server sales have stalled in this global economy, and that it's not a major player in the tablets and smartphones that folks are using for entry-level computing these days. It's working on it, snapping up higher-margin business service companies and shaving its cost structure. It's not pretty, but it's paying off apparently with chunkier profitability.

K12 provides Web-based curricula for students from kindergarten through their senior year of high school, unlike the for-profit post-secondary educators that are getting hammered lately in a climate of crummy student loan repayment rates. K12 doesn't have to worry about that, providing cost-effective and convenient solutions to public grade school.

Staples is the leading office supplies retailer. Small businesses know the aisles of their local Staples superstore well. The chain is a great way to check the pulse of corporate America, and the fact that the pros see slightly improving profitability is a welcome sight.

Networking stocks have been posting generally better-than-expected results this earnings season, and Aruba Networks in particular rallied after posting strong financials in its previous quarter. The economy may not be so hot these days, but you have to go back nearly three years to find the last time that Aruba Networks showed up with a year-over-year decline in earnings. Everything's pointing to a strong report on Thursday.

Finally, we have Dolby Laboratories. Analysts see the audio technology rock star cranking out a quarterly profit of $0.60 a share, just ahead of the $0.57 a share it rang up a year earlier.

Cross those fingers, but know the fundamentals
Investors in these seven 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 seven stocks wouldn't have it any other way.

Are you a buyer or a seller of stocks these days? Share your strategy in the comment box below.

At the time this article was published Motley Fool newsletter serviceshave recommended buying shares of Dolby Laboratories, Staples, K12, and Dell. Try any of our Foolish newsletter servicesfree for 30 days. We Fools may not all hold the same opinions, but we all believe thatconsidering a diverse range of insightsmakes us better investors. The Motley Fool has adisclosure policy.Longtime Fool contributorRick Munarrizcalls them as he sees them. He does not own shares in any of the stocks in this story. Rick is also part of theRule Breakersnewsletter research team, seeking out tomorrow's ultimate growth stocks a day early.

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