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Larry Schutts
- http://www.stockwinners.com

Larry Schutts, a former university professor, is vice president of Stockwinners.com and a contributing editor for Theflyonthewall.com. Larry looks for stocks with technical and fundamental characteristics indicating gains in the next 30 days. However, price movements may be volatile. He includes a stop-loss price in each post. Consider selling a position should the stop-loss be violated.

Charles Schwab Corporation (NASDAQ: SCHW) is a leading provider of financial services, with more than 300 offices, 7.3 million client brokerage accounts, 1.3 million corporate retirement plan participants, 355,000 banking accounts, and $1.4 trillion in client assets. The company provides a full range of securities brokerage, money management and financial advisory services to individual investors and independent investment advisors. The Charles Schwab Bank provides banking and mortgage services. President and COO Walter Bettinger took the CEO reins from founder Charles Schwab this week. Schwab remains executive chairman.

Last week, the company presented its Q2 report. Earnings of 27 cents per share and revenues of $1.31 billion topped Street estimates 26 cents per share and $1.30 billion. Clients brought $26 billion in net new assets to the firm. Active brokerage accounts and retirement plan participants were up 5% and 13% from year-earlier levels and banking accounts more than doubled.

Tempur-Pedic International (NYSE: TPX) makes bedding products. Offerings include pillows, mattresses, adjustable beds and cushions. The goods feature a visco-elastic foam technology that was developed by NASA during the 1970s, to help cushion astronauts during liftoff. The company markets its products through furniture and department stores, medical retailers, hospitals and the Internet. They are sold under the brand names TEMPUR and Tempur-Pedic. About a third of Tempur-Pedic's revenue comes from international sales.

The company pleased investors last week, when it reported Q2 EPS of 27 cents and revenues of $238.7 million. Analysts had been looking for 23 cents and $232.9 million. Over the course of the quarter, the firm increased its cash balance by 46.8% and reduced total debt by 6.8%. Management also issued in-line guidance for FY08 results.

A. O. Smith Corporation (NYSE: AOS) manufactures water heating equipment and electric motors. The Water Products segment makes a line of gas and electric water heaters, commercial water heating equipment, copper-tube boilers, and water systems tanks. The Electrical Products segment produces hermetic and fractional horsepower motors. The company sells its water heater products to plumbing wholesalers and retail outlets. Its motors go to original equipment manufacturers and distributors. The firm operates primarily in the U.S., Canada, Mexico and China. Sears Holdings (NASDAQ: SHLD) is a major retail client.

The company pleased investors last week, when it reported Q2 EPS of $1.03 and revenues of $622.2 million. Analysts had been looking for 78 cents and $606.3 million. The CEO attributed success to "our ability to operate our plants efficiently, focus on cost containment, and recover increased raw material costs from our customers." Management also guided FY08 EPS to $2.95-$3.10, versus consensus of $2.89.

Amphenol Corporation (NYSE: APH) makes electrical connectors and cables for communications, medical, aerospace, military and industrial systems. The firm's connectors are used in computers, aircraft, cars, office equipment and medical instruments. Its coaxial cable goes to cable TV clients and its flat-ribbon cables are used with computer and telecommunications products. Amphenol ships to more than 10,000 customer locations around the world.

Investors were pleased last week, when the firm reported Q2 EPS of 61 cents and revenues of $846.8 million. The Street had been looking for 58 cents and $815.5 million. The CEO noted that growth was broad-based, with particular strength in the global communications, military and commercial aerospace markets. Management also guided Q3 EPS to 59-61 cents (59 cent consensus), Q3 revenues to $825-$840 million ($826.8M consensus), FY08 EPS to $2.34-$2.38 ($2.33 consensus) and FY08 revenues to $3.278-$3.308 billion ($3.26B consensus). Deutsche Securities subsequently reiterated its "buy" rating on the stock and RBC Capital Markets repeated its "outperform". Both firms boosted their price targets to $57.

Dun & Bradstreet Corporation (NYSE: DNB) is a leading source of business information. Its global commercial database contains more than 130 million business records, including the largest volume of business-credit information in the world. The firm integrates the data in a variety of software products and Web-based applications that customers use to support a broad spectrum of business decisions. Dun & Bradstreet also offers marketing information and purchasing-support services.

The company pleased investors last week, when it guided Q2 EPS to $1.15 and Q2 revenues to $427.7 million. Analysts had been expecting $1.10 and $414.04 million. Management also anticipated FY08 EPS of $5.19-$5.29, versus Street consensus of $5.28.

Resources Connection (NASDAQ: RECN) provides professional services to corporations, in support of client-led projects and initiatives. Areas of expertise include finance, accounting, risk management, internal auditing, information technology, human resources, supply chain management, and legal matters. The firm serves 2,400 companies from more than 80 offices around the world. The client list includes Southwest Airlines (NYSE: LUV) and Exelon Corporation (NYSE: EXC).

Resources Connection pleased investors last week, when it reported fiscal Q4 EPS of 35 cents and revenues of $236.7 million. Analysts had been expecting 28 cents and $228.0 million. During the quarter, the company repurchased about 1.1 million RECN shares. Deutsche Securities subsequently reiterated its "buy" rating on the issue.

St. Jude Medical (NYSE: STJ) designs, manufactures, and distributes medical devices for heart-related and neurological conditions. The firm's Cardiac Rhythm Management segment makes pacemakers and implantable cardioverter defibrillators, to regulate heart rhythm. The Neuromodulation unit develops pacemaker-like implantable systems to treat chronic, intractable pain, and other nervous system disorders. The Cardiovascular division offers therapies and technologies for treating people with cardiovascular and peripheral vascular disease. The Atrial Fibrillation segment develops products to diagnose, treat, and seek a cure for atrial fibrillation. Boston Scientific (NYSE: BSX) is a major competitor.

The company pleased investors last week, when it reported Q2 EPS of 60 cents and revenues of $1.14 billion. Analysts had been expecting 55 cents and $1.06 billion. The CEO noted that revenue exceeded guidance in every business category. Management also guided Q3 EPS to 56-58 cents (53 cent consensus) and FY08 EPS to $2.28-$2.33 ($2.19 consensus).

IKON Office Solutions (NYSE: IKN) provides document management systems and services to business and government clients. The firm leases/sells name-brand office equipment and provides associated office supplies, equipment maintenance programs, technical support and lease financing. It also offers document management outsourcing, electronic file conversions, facilities management and training. IKON operates from over 400 locations in North America and Western Europe. Xerox (NYSE: XRX) is a major competitor.

The firm pleased investors earlier in the week, when it guided fiscal Q3 EPS to the range 35-37 cents and Q3 revenues to $1.05 billion. Analysts had been expecting 30 cents and $1.05 billion. The solid outlook was driven by better than anticipated revenue and gross margin in Customer Service and Supplies and by a higher gross margin in Managed and Professional Services. Management also issued FY08 EPS guidance of $1.00-$1.05 (97 cent consensus).

Altera Corporation (NASDAQ: ALTR) makes high-density programmable logic devices and associated development tools. PLDs are integrated circuits that clients can program themselves, using software that Altera also provides. This allows clients to provide their customers with special-purpose chips that cost less than equivalent custom-designed devices. Altera's circuits are used by thousands of customers in computing, telecommunications, industrial, and automotive applications. Clients include Honeywell (NYSE: HON), Johnson Controls (NYSE: JCI) and Motorola (NYSE: MOT).

Investors were pleased earlier in the week, when Altera reported Q2 EPS of 32 cents, revenues of $359.9 million and a gross margin rate of 67.1%. Analysts had been expecting 27 cents, $346.7 million and 65.01%. The company also guided Q3 revenues to about $349.1-$359.9 million ($350.51M consensus). Management noted a current book-to-bill ratio significantly above one and remarked that the firm had repurchased 526,000 shares so far in Q3. The board declared a five cent quarterly dividend.

Allegheny Technologies (NYSE: ATI) produces specialty metals. Products include titanium and titanium alloys, nickel-based alloys and superalloys, stainless and specialty steels, tungsten materials, zirconium, hafnium and niobium. The steels, the nickel alloys and the titanium alloys are offered as plate, sheet, engineered strip, precision rolled strip, and grain-oriented electrical products. The company also offers forgings and castings. Its biggest customers are in the aerospace, chemical process, and oil and gas industries.

Investors were pleased earlier in the week, when Allegheny issued upside EPS guidance for Q2. Management said it expected $1.65-$1.67, up from its earlier view that earnings would be somewhat higher than the $1.40 per share of Q1. The Street had been looking for $1.53. The CEO noted that the firm's risk management programs were reducing the impact of volatile input costs.

Merit Medical Systems (NASDAQ: MMSI) develops and manufactures proprietary disposable medical devices used in interventional and diagnostic procedures, particularly in cardiology and radiology. Offerings include the catheters, guide wires, inflation devices, needles, and tubing used in heart stent procedures, pacemaker placements, and angioplasties. As well, Merit makes products for endoscopy, dialysis, and other therapeutic and diagnostic procedures. Boston Scientific (NYSE: BSX) and Johnson & Johnson (NYSE: JNJ) are major competitors.

The firm pleased investors last week, when it guided Q2 EPS to 19-21 cents and Q2 revenues to about $57.4 million. Analysts had been expecting 16 cents and $55.77 million. Gross margins for the quarter were estimated at 42.7%, which would be a 500 basis point improvement from Q2'07. CL King subsequently upgraded the shares to "accumulate".

The Finish Line (NASDAQ: FINL) is a mall-based specialty retailer, offering athletic and casual footwear and sportswear through 699 Finish Line stores in 47 states. Featured brands include Nike, Puma, Jordan, Lacoste and Adidas. The firm also sells urban street wear through 94 Man Alive outlets in 19 states. Foot Locker (NYSE: FL) and The Sports Authority are major competitors.

The firm pleased investors late last month, when it reported fiscal Q1 EPS of two cents and revenues of $287.9 million. Analysts had been looking for a loss of five cents and $281.3 million. In discussing the positive quarter, the CEO cited successful application of strategic merchandising and inventory management programs. B. Riley subsequently upgraded the shares to "buy" and Sterne Agee reiterated its "buy" call.

G-III Apparel Group (NASDAQ: GIII) manufactures and distributes outerwear and sportswear, under licensed and company-owned brands. The firm creates fashions for such names as Calvin Klein, Kenneth Cole, Guess?, Jones New York, Nine West, IZOD and Tommy Hilfiger. It also focuses on apparel for NFL, NBA, NHL and MLB teams. Further, G-III cooperates with leading retailers in developing product lines that are sold under its own private labels. Department store customers include Macy's (NYSE: M) and Wal-Mart (NYSE: WMT).

Investors were pleased last week, when the company moved to establish a more significant retail presence by purchasing 116 outlet stores from Wilsons The Leather Experts. The acquisition led management to boost FY09 EPS guidance to $1.35-$1.40 ($1.29 consensus) and FY09 revenue guidance to $720-$730 million ($661.86M consensus). Brean Murray subsequently reiterated its "buy" rating on the shares, noting that the deal offered a "natural outlet" for G-III's products and reduced its dependence on the department store channel.

Cato Corporation (NYSE: CTR) retails women's fashions. It offers an assortment of apparel and accessories, including sportswear, dresses, coats, shoes, lingerie, costume jewelry and handbags. The company operates over 1,300 retail stores under the names Cato, Cato Fashions, Cato Plus, It's Fashion! and It's Fashion Metro, in 31 states. The stores are located primarily in strip shopping centers anchored by national discounters, or market-dominant grocery stores.

The firm surprised the Street last week, when it boosted its Q2 EPS guidance from 28-33 cents to 42-44 cents. Analysts had been expecting 30 cents. Management also announced that June same store sales were up 4.0% (yr/yr). That also topped the analyst view (+2.3%).

Herman Miller (NASDAQ: MLHR) designs and manufactures interior furnishings for office, healthcare, educational and residential settings. Offerings include modular systems, filing and storage systems, wooden casegoods, executive task chairs and desk lamps. Products are manufactured in the U.S. and the U.K. for customers in North America, Europe, Asian and Australia.

The firm pleased investors late last month, when it reported fiscal Q4 EPS of 71 cents and revenues of $519.1 million. Analysts had been looking for 57 cents and $488.4 million. Management also guided Q1 EPS and revenues to ranges in-line with consensus Street views. In discussing the solid results, the company credited the effects of its international expansion program.