5 Reasons Not to Worry This Week

After a remarkable first quarter, the abridged trading week that kicked off the second quarter was a bit of a dud.

The S&P 500 surrendered 0.7% of its value, while the 30 blue chips that make up the Dow Jones Industrial Average closed out the week nearly 1.2% lower.

Many will argue that the market was due for a breather after posting double-digit percentage gains on the S&P 500 in back-to-back quarters, but most of the economic metrics that came to light last week were still generally positive.

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 Bank of the Ozarks.

Analysts see the Little Rock-based banker growing its bottom line by 22% when it reports on Thursday. In an encouraging sign, Bank of the Ozarks increased its dividend rate last week. Then again, that in and of itself wasn't much of a surprise. The regional bank has come through with seven consecutive quarters of payout hikes.

Google is no stranger to anyone reading this article. Big G is the world's most popular search engine, and by default is also the global online advertising leader. It's also the company behind YouTube and Android. The video-sharing website and smartphone mobile operating system are the category killers in their specialties, though both have been tricky to monetize for the dot-com darling. Thankfully, Google is making record sums of earnings in its bread-and-butter paid-search business.

Fastenal makes nuts, bolts, and other industrial hardware. Wall Street's banking on a profit of $0.35 a share out of Fastenal, well ahead of the $0.27 a share it posted a year earlier. The trend is looking good for Fastenal. Three months ago the pros were targeting net income of $0.33 a share. That bottom-line estimate was bumped up to $0.34 a share, until getting upgraded yet again to $0.35 a share just last week.

Hungry for another encouraging Fastenal sign? Even though the company merely met Wall Street estimates in each of the two previous outings, you have to go back more than two years to find the last time that Fastenal missed analyst profit projections.

Rite Aid is the profitless drugstore chain. It's been years since Rite Aid has been in the black in any given quarter, but it has posted substantially narrower deficits than what the market was banking on in its last three quarters.

Finally, we have Wells Fargo, kicking off a wave of the "too big to fail" banking titans that will report the following week. Wells Fargo reports on Friday morning, and the market's looking for modest improvement on the bottom line.

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.

Fool co-founder David Gardner has been behind some of these winning picks, but now there's a new multibagger on his growth newsletter's radar. Read up in a free report that's available right now.

At the time thisarticle was published The Motley Fool owns shares of Wells Fargo and Google. The Fool owns shares of and has created a covered strangle position in Wells Fargo.Motley Fool newsletter serviceshave recommended buying shares of Wells Fargo and Google. The Motley Fool has adisclosure policy. We Fools may not all hold the same opinions, but we all believe thatconsidering a diverse range of insightsmakes us better investors. Try any of our Foolish newsletter servicesfree for 30 days.Longtime Fool contributor Rick Munarriz calls 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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