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.

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.

Company

Latest-Quarter EPS (Estimated)

Year-Ago Quarter EPS

Ford

$0.26

$0.20

Fusion-io

$0.08

$0.05

Qualcomm

$1.12

$0.97

Liquidity Services

$0.38

$0.37

PulteGroup

$0.30

$0.04


Source: Thomson Reuters.

Clearing the table
Let's start at the top with Ford. I bought a Ford -- my first Ford since the early 1990s -- two years ago. I'm happy with my Flex, and apparently I'm not alone. The Flex itself hasn't been a very big seller for the automaker, but the company's refreshed lines of surprisingly high-tech cars have been catching on with test drivers.

Ford is doing so well that it doubled its quarterly dividend earlier this month, and now the only major stateside automaker that didn't participate in the government bailout a few years back is on cruise control. Analysts see profitability climbing 30% when Ford reports tomorrow.

Fusion-io moved nicely higher earlier this month after introducing a new product line. The data storage company's ioScale provides enterprises with as much as 3.2 terabytes of memory capacity without having to build out a large fleet of servers.

Fusion-io reports on Wednesday. Naturally, ioScale wasn't part of the quarter that ended in December, though it's a safe bet that the company will discuss the new line and any initial reactions that it has been receiving.

Qualcomm also reports on Wednesday. The patent-rich wireless chip designer has been milking its CDMA technology to deliver strong growth during the smartphone boom. It isn't really a surprise to see Qualcomm continue to grow. Analysts see the mobile tech bellwether earning $1.12 a share, comfortably ahead of the $0.97 a share that it posted a year earlier.

Liquidity Services is also reporting this week. The company runs an online marketplace for surplus, wholesale, and salvage assets. Liquidity took a hit in November after revealing uninspiring near-term guidance.

Facing contracting operating margins in a market where competition is intensifying, Liquidity offered up adjusted earnings per share of $2.05 to $2.23 for the new fiscal year that began in October. Analysts were perched at the high end of that range at the time. Wall Street has since gone on to take that fiscal 2013 figure down from $2.20 a share to $2.15 a share.

The good news here is that even the marketplace operator's cautious guidance calls for double-digit growth on the bottom line for the entire year. Analysts see only a marginal advance for the fiscal first quarter that it will report on Thursday, but those same pros see better things ahead after that.

Finally, we have PulteGroup. The homebuilder's ascent isn't a surprise. Real estate developers have stormed into favor since the housing market bottomed in 2011.

It's fine to be cautious.

This morning's strong durable-goods data pushed the yield on benchmark 10-year Treasury notes above 2% for the first time since early last year. Yes, this is confirmation that the country's economy is improving -- and that in and of itself bodes well for new construction -- but will buyers flinch at today's asking prices if mortgage rates pop higher?

Pulte has been able to take advantage of the pent-up demand for new digs by potential homeowners lately. The $0.30 a share that Wall Street is projecting is several times over what Pulte rang up a year earlier during the same period. However, investors will want to make sure that they pay attention to the developer's backlog of new home orders by the end of the period and if contract cancellations continue to shrink.

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.

Looking for another stock to be excited about? The Motley Fool's chief investment officer has selected his No. 1 stock for the next year. Find out which stock it is in our brand-new free report: "The Motley Fool's Top Stock for 2013." I invite you to take a copy, free for a limited time. Just click here to access the report and find out the name of this under-the-radar company.

The article 5 Reasons Not to Worry This Week originally appeared on Fool.com.

Longtime Fool contributor Rick Aristotle Munarriz owns shares of Ford. The Motley Fool recommends Ford and Liquidity Services. The Motley Fool owns shares of Ford and Qualcomm. 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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