5 Reasons Not to Worry This Week
It's not a perfect world out there for investors, but things may be starting to get better.
This morning's retail sales report was encouraging. The Commerce Department reports that retail sales rose at a seasonally adjusted 0.1% clip for the month of April. That may not seem all that encouraging, but economists were bracing for a decline.
It gets better.
Back out the volatile gasoline prices and retail spending actually rose 0.7% last month.
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
Clearing the table
Let's start at the top with Wal-Mart.
The world's largest retailer is probably benefiting from April's surprising burst of spending activity. Wal-Mart is best known as a place for shoppers to get more bang for their money, and it's working. The chain estimates that 60% of the country winds up shopping at Sam Walton's retail empire in any given month.
The market isn't holding out for monster growth here. The pros see sales inching just 3% higher with earnings climbing by just 5.5%. However, Wal-Mart has managed to beat Wall Street's profit targets every quarter over the past year.
Cisco is the networking giant arming enterprises with routers, switches, and other tech gear to get folks connected. Cisco's push into consumer products didn't go over so well, but now a more focused tech bellwether is growing again. Analysts are projecting just a marginal uptick on the bottom line here, but -- just like Wal-Mart -- Cisco has managed to surpass quarterly profit expectations with ease over the past year.
SINA is the Chinese dot-com darling behind SINA Weibo, the popular social platform that's being hailed by many as the Twitter of China. Building out Weibo's infrastructure has squeezed margins at SINA, but analysts see a much narrower deficit this time around.
NuPathe is also expected to post a narrowing quarterly loss when it reports tomorrow. NuPathe is biotech tackling diseases of the central nervous system. Its lead product -- Zecurity -- is FDA approved for the acute treatment of migraines. NuPathe also has a couple of other treatments moving their way toward regulatory approval through the development process.
Finally, there's NQ Mobile. The global provider of mobile Internet services is a speedster. Wall Street sees revenue more than doubling in its latest quarter. NQ Mobile's bottom line isn't growing as fast, but momentum is in its favor after blowing through analyst profit projections in the past two periods.
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.
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The article 5 Reasons Not to Worry This Week originally appeared on Fool.com.Longtime Fool contributor Rick Munarriz has no position in any stocks mentioned. The Motley Fool recommends Cisco Systems and SINA. 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.
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