Standout Nuggets From Last Night's Earnings

 | Aug 03, 2012 | 7:00 AM EDT  | Comments
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open

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mcp

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eog

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awk

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ltd

We are moving toward the tail end of earnings season, but the flow of recent reports still provides food for thought. As I scanned the headlines last night (and earlier this week in a some cases) the following reports stood out.

Open Table (OPEN): The numbers themselves were OK, though I still question the valuation. Still, seeing a Web 2.0 name appreciate after earnings -- unlike Facebook (FB) or Zynga (ZNGA) -- is refreshing. In this case, the company is selling a service in which mobile usage is an obvious advantage.

Molycorp (MCP): The stock has round-tripped from the bubble that formed in 2010, proving once again that what goes up must come down, even if everyone believes it will be different this time. Management is executing a forward integration strategy and it should go into production soon, but often the fate of a stock is not in the company's hands. With rare earth prices declining before any incremental supply hits the market, I just wonder what will happen in a year when Molycorp and Lynas are in full production.

EOG Resources (EOG): This is the anti-Chesapeake (CHK), with 86% of revenue derived from liquids rather than natural gas. Prices are firm when the commodity is wet, enabling EOG to top earnings per share estimates by $0.18 on a half-billion revenue beat.

American Water Works (AWK): The quarter was not awkward, with a $0.17 EPS beat on sales that came in $34 million above targets, and better guidance for the year. There is still good money to be made in utilities and in the most basic of commodities, and American Water Works continues to earn its unlikely spot among earnings momentum names.

Limited (LTD): I would be remiss in not pointing out this Dvorchak fave, the longest-held name in my dividend strategy. The company again proved why it's a long-term winner, putting up comparable-store sales of 12% vs. a 6% expectation, which led to sales upside. More important, Limited announced yet another special dividend of $1 per share. Oddly, the stock initially opened lower Thursday morning, but then rebounded. Limited is the gift that keeps on giving.

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