It’s the last quiet week of earnings announcements before the rush of first quarter results hit the wires. But never fear, I’ve uncovered three companies that are poised to beat earnings and most likely put some profits in your pockets.
All three should be considered “EZ money stocks” as they’ve regularly rewarded investors in the days surrounding their quarterly results. Each has the potential to return more than 15 times the average 1-year CD rate of 0.28%, according to Bankrate.com.
Walgreens Boots Alliance Inc. (NASDAQ: WBA) – Consistently a Money Maker
In the last three years, the consumer services company’s stock price headed higher on nine out of 12 quarterly checkups. On average, WBA shares increased 3.83% in the three days before and after winning announcements.
The drug store chain will release its fiscal 2016 second quarter earnings results at 7 a.m. Eastern time Tuesday, April 5th, 2016, followed by a conference call with management beginning at 8:30 a.m. Eastern time.
Wall Street analysts believe the company will earn $1.28 per share. After watching this company for many years my estimate is a nickel higher. Anticipate WBA putting something closer to $1.33 on the bottom line. If we’ve made the right call, it will be the sixth consecutive bullish surprise.
It’s no surprise that Walgreens consistently bypasses the consensus as the company has better than average earnings power. The retailer boasts a healthy return-on-equity (ROE) of 17.41%, assets outpacing liabilities, and a stockpile of cash.
Quality of earnings gets a bullish checkmark, too. In the first quarter, year-over-year (YoY) revenue increased by an attractive 48.5%. Meanwhile, selling, general and administrative expenses (SG&A) rose at a slower pace of 35.4%. The difference means higher operating profit margins, which in turn means more money filters to the bottom line.
Don’t be surprised to see the trend of lower costs relative to sales continue as increasing efficiencies is a priority of WBA’s Board of Directors.