Which Mega Engineering Stocks have the Strongest Earnings Trends?

February 23, 2013

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Earnings trends are extremely important when evaluating stocks. At Wall St. Cheat Sheet, we view increasing earnings quarter-over-quarter as a simple way to gauge whether costs and the business model are stable. Then we like to analyze whether the company is outperforming peers in the sector. This is what we call the “E-Squared” investment analysis (‘E = Earnings Are Increasing Quarter-Over-Quarter’ + ‘E = Excellent Relative Performance Versus Peers and Sector’).

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Here’s your Cheat Sheet to how the top 5 engineering stocks rank via earnings trends:

KBR, Inc. (NYSE:KBR): Current Price $30.57

Fiscal Year	2008	2009	2010	2011	2012
Revenue ($) in millions	11,580	12,100	10,100	9,261	7,921
Diluted EPS ($)	1.90	1.79	2.07	3.16	0.97

2012 seems to have been a very disappointing year for KBR, as both revenue and EPS hit a wall.

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Next, our CHEAT SHEET investing framework asks us to drill down to the recent quarterly data:

Quarter	Dec. 31, 2011	Mar. 31, 2012	Jun. 30, 2012	Sep. 30, 2012	Dec. 31, 2012
Revenue ($) in millions	2,096	2,001	2,062	1,992	1,866
Diluted EPS ($)	0.60	0.61	0.70	-0.55	0.21

Though revenue has fallen off during the last two quarters, EPS took a sharp jump in December 2012. We’ll keep this company on the list for now…

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