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3 Cheap Stocks with Better as Expected Earnings

November 02, 2011 | About:
Surprises in earnings aren’t surprising nowadays. During the third-quarter earnings season, about half of S&P 500 companies have reported results and two-thirds of them have topped forecasts. Historically, companies that beat earnings and sales are expected to produce a better future performance than companies that beat only one forecast alone. Below are three cheap stocks that have beaten their quarter earnings and sales forecasts by at least 5%:

1. DuPont (DD) is acting within the major diversified chemicals industry. The company hasa market capitalization of $45.6 billion, generates revenues in an amount of $37.7 billion and a net income of $3.5 billion. It follows P/E ratio is 13.4 and forward price to earnings ratio 11.2, Price/Sales 1.2 and Price/Book ratio 4.0. Dividend Yield: 3.3 percent. Last quarter its sales jumped 32 percent. Twelve percentage points of sales growth was owed to acquisitions and another four came from currency effects, but the rest came from a small increase in volume and sharply higher prices.

2. Philip Morris International (PM) is acting within the tobacco industry. The company hasa market capitalization of $126.7 billion, generates revenues in an amount of $75.3 billion and a net income of $8.4 billion. It follows P/E ratio is 15.3 and forward price to earnings ratio 13.9, Price/Sales 1.7 and Price/Book ratio 59.6. Dividend Yield: 4.3 percent. Last quarter, Philip Morris International reported a 26.4 percent sales increase. Remarkably, a 52.7 percent jump in Asia revenue more than offset declines in other markets, catching analysts by surprise.

3. Western Digital (WDC) is acting within the data storage devices industry. The company hasa market capitalization of $6.4 billion, generates revenues in an amount of $9.8 billion and a net income of $769.0 million. It follows P/E ratio is 8.4 and forward price to earnings ratio 6.3, Price/Sales 0.7 and Price/Book ratio 1.1. Dividend Yield: 0 percent. Last quarter, WDC quarter sales rose 12.4 percent and earnings by 19.8 percent. Be careful, the company is expected to lose money in its current fiscal year, which runs through June. Roughly 60% of its production is in Thailand, which has been devastated by floods in recent months.

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Dividend
I am a private full time investor searching for investments and investment ideas.

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