MINNEAPOLIS ( Stockpickr) -- Investors got an early start on earnings season. Putting the nonsense of pure speculation behind us, the market moved excitedly higher last week in anticipation of a strong earnings season. With valuations ultimately determined by profits, the uptick is not surprising given profit growth for many publicly traded stocks.
Within the strong rally, those companies reporting results last week enjoyed solid gains or disastrous results depending on the news being released. In the winners bracket, we rightly identified Darden Restaurants (DRI) and Apollo Group (APOL). Both stocks moved up solidly in the trading day after their respective reports.
On the downside, we also correctly predicted weakness in Family Dollar (FDO) and the earnings disaster that was KB Home (KBH). Family Dollar had been higher on takeover speculation, but actual earnings were not enough to support what was becoming a lofty valuation. KB Home posted a bigger loss as the homebuilding market continues to sputter.