March 30, 2012 | Filed Under » Stock Analysis
By Ryan FuhrmannPublished 03/28/2012 – 11:30
Back in the fall of 2010, I touted technology giant International Business Machines (NYSE: IBM ) in the belief that its stock was poised to have a strong run. A key part of this bullishness was a bold prediction by its management team that it would double earnings per share (EPS)  from $10 to $20 by 2015.
Defense and aerospace firm Esterline Technologies (NYSE:ESL) reported great sales growth during its first quarter, though this was due to the purchase of a French rival. Profit growth lagged, but management has ambitious expansion targets over the long haul. Recent trends could make meeting these goals difficult, but it’s hard to argue with the company’s track record and aerospace exposure could easily offset challenging defense industry trends.
After years of underinvestment in its brand, Wendy’s (Nasdaq:WEN) is pursuing an ambitious program to remodel its store base, and better compete with a group of peers it refers to as the “new quick service restaurant” (QSR) group. The program will be expensive, but could be just what the company needs to start boosting returns for shareholders.
A.T. Cross (Nasdaq:ATX) was perhaps known best for its Cross pens and related writing accessories, but in recent years has shifted its focus to a couple of higher end sunglass brands. Eyewear is increasingly driving the company’s fortunes, and their solid growth potential make the stock worth a look. For more, see Earning Forecasts: A Primer.
Home improvement giant Lowe’s (NYSE:LOW) closed out its fiscal year with solid profitability and a modest boost in the bottom line. A push for further growth in the face of continued challenging industry conditions is commendable, but much of any potential is already baked into the share price valuation. For more, see Earning Forecasts: A Primer.
TJX Companies (NYSE:TJX) is better known for store brands that include TJ Maxx, Marshall’s and HomeGoods. Due to solid, consistent growth performance, investors have gotten to know the stock well and have bid it up to its all-time highs. This could imperil future shareholder returns, but the firm’s operations still have plenty of growth potential. For more, see Earning Forecasts: A Primer.
Caribou Coffee (Nasdaq:CBOU) is a small but growing operator of nearly 600 coffeehouses. Management has set out some ambitious growth goals going forward, and has just started recently delivering on its expectations. The share price valuation assumes many more years of rapid expansion, but is definitely achievable given the small store base and potential of its commercial sales.