3 Stocks Bucking the Earnings Slowdown

3 Stocks Bucking the Earnings Slowdown

Hough: Profit growth is slowing for most of the market, but not for these firms.

Over the past three years, corporate profits underlying the S&P 500 index have rebounded from a negative number to a record sum. Soaring profits, in turn, have helped to justify a quick rise in stock prices. But profits for the current quarter are expected to increase just 5.8% from a year ago.

That’s slow by a variety of measures. Six months ago Wall Street was forecasting more than twice as much growth for this quarter. The compounded average growth rate of the past two decades is over 11%. During the same quarter a year ago, the growth rate was 16%.

The slowdown is more a return to normalcy than a stumble. U.S. companies have turned record percentages of their sales into profits during the recovery, partly because they have held off on costly hiring for as long as possible, and partly because they have enjoyed booming demand in overseas markets, notably China.

But China’s government on Monday cut its target for this year’s economic growth to 7.5%–more than double the U.S. rate, but China’s slowest rate in eight years. And in January, America added more jobs than during any January since the housing bubble. (Numbers for February are due out Friday.) Jobs growth is fine news, but it suggests U.S. companies have already tapped the easiest sources of profit gains.

Investors, then, should lower their return expectations for stocks, which after Tuesday’s market plunge sell for almost precisely their average historical price relative to trailing earnings. They can also seek out companies that are bucking the earnings slowdown. Below are listed a handful that turned up on a recent screen for companies with rising earnings estimates for the current quarter and current fiscal year as well as a record of topping earnings estimates in their most recent three quarterly reports.

Lincoln Electric
  • 2012 EPS forecast up 10% in three months

Lincoln Electric (LECO: 45.58, 0.57, 1.27%) makes welding products, including equipment and consumables. That gives it exposure to worldwide construction and industrial markets, including pipelines and power plants. Despite a financial crisis in Europe last quarter, Lincoln increased sales 23% from a year earlier on a rise in U.S. manufacturing and exports. Earnings are expected to climb 19% this year. The stock sells for 15 times the 2012 forecast.                      More

wordpress visitor counter

Get Free Email Updates!

Signup Now to Receive Updates and Alerts!

We will never give away, trade or sell your email address. You can unsubscribe at any time.


Candice writes for several publications, including The Christian Post, Red State, The Black Sphere and Patriot Update. She is the Science & Tech Editor at the Minority Report Blog and the founder and Editor-in-Chief at Front Lines. She's also the founder of Candice Lanier's Tech News and works as a computer consultant. Additionally, Candice is an antiques dealer.

More in


Meet the 13-year-old CEO who built a $200,000 business and is mentored by Daymond John

Candice LanierMar 30, 2015

Amazing Chart: What U.S. Dealings with Iran and Saudi Arabia Really Look Like:

Steve FoleyMar 29, 2015
Outrage In Missouri Town After Police Shooting Of 18-Yr-Old Man

White Cops Harass the Wrong Unarmed Black Youth – Racism to the Core

Michael BeckerMar 29, 2015
15-0328 miley

Miley Cyrus Has Done Republicans a Favor: WHAT?

Michael BeckerMar 29, 2015
15-0328 Harry Reid

Feel Good Story of the Decade: Harry Reid Leaving!

Michael BeckerMar 29, 2015

Gramps’ Excellent Adventure

Frank McHaleMar 29, 2015

The Minority Report is a network of websites devoted to Conservative & Libertarian politics in the United States. In 2014 the network had over 20 million page views!

On this site you'll find posts & links to some of the best and most comprehensive center-right news and opinion on the net...

March 2012
« Feb   Apr »


Copyright © 2014 The Minority Report Network