As second-quarter earnings reports begin to kick into gear, I can’t help but point out that the majority of earnings reports we’ve covered over the past year have been better than expected. With so many companies reporting during the weeks that comprise earnings season, it’s easy for some earnings reports to fall through the cracks.
Each week for the past year, I’ve taken a look at three companies that could be worth further research after either beating or missing their profit expectations. Today, we’ll take a gander at three more companies that reported earnings last week. They may have slid under your radar, but they deserve a look.
|Company||Consensus EPS||Reported EPS||Surprise|
|Advanced Micro Devices, Inc. (NYSE:AMD)||($0.18)||($0.13)||28%|
|Marten Transport (NASDAQ:MRTN)||$0.26||$0.32||23%|
|Philip Morris International (NYSE:PM)||$1.34||$1.29||(4%)|
Advanced Micro Devices
It’s certainly a gamble, but perhaps the calls for AMD’s demise were a bit premature after all. I certainly didn’t expect anywhere near the quarter that AMD delivered given that microprocessor giant Intel Corporation (NASDAQ:INTC) missed Wall Street EPS expectations by $0.01 in the first quarter. Overall profit tumbled 25% from the year-ago period because of weak PC sales. Furthermore, research firm IDC noted that PC sales dipped a whopping 14% in the first quarter — essentially their worst quarterly dip on record. Even with Intel backing its full-year profit forecast, no one was expecting much from Advanced Micro Devices, Inc. (NYSE:AMD).
Yet, for all intents and purposes, AMD’s cost-cutting and ongoing restructuring is beginning to show the first signs of a turnaround. AMD’s loss and sequential revenue decline was much lower than many had forecast (including AMD), and had a lot to do with its 18% decrease in operating expenses, and its key wins in the gaming sector as the processing core provider for Sony‘s Playstation 4 and Microsoft Corporation (NASDAQ:MSFT)‘s new Xbox console. With a renewed focus on graphics, gaming, and mobile, AMD just might be able to pull off the impossible and return to profitability before the year is out — even as PC sales continue to slump. I never thought I’d say this, but don’t count out Advanced Micro Devices, Inc. (NYSE:AMD) just yet!
Late last year I went out on a limb and predicted that three underperforming sectors were going to see the sunshine in 2013. One of those was the PC sector, and, thus far, I’ve been dead wrong in that respect. On the other hand, my forecast that trucking stocks would see relief has been pretty much spot-on.
Marten Transport, a provider of temperature-sensitive trucking solutions, reported its first-quarter results last Tuesday and absolutely drove over Wall Street’s profit estimates by 23%. Operating revenue increased 8.6% and net income spiked 32.2% as the company managed to efficiently cut costs and boost its fuel surcharges to counteract any shipping weakness that may have been apparent.
One factor set to work in Marten’s favor — since it does transport food — is that food inflation is relatively tame across nearly all tradable commodities. With food costs stable, consumers are more apt to buy and demand is unlikely to fall. It also doesn’t hurt that diesel fuel prices have been stuck in a tight range for two years now, giving trucking companies like Marten Transport a chance to boost their prices to make up the difference. I’ll be looking for trucking companies like Marten to continue to outperform in 2013.