NEW YORK (Real Money) -- The commonality of success is now coming through loud and clear. We are now seeing and refining what buyers are looking for before they are willing to pay up beyond the last sale. It's a convincing formula, and I will use four strong companies to lay it out: Alcoa (AA), Intel (INTC), PPG Industries (PPG) and Honeywell (HON).
First, the obvious. Each company in its earnings release makes it very clear that there was a clean beat in the top and bottom lines. The magnitude of the beat varies, but it is certainly better than what the high analyst was looking for. Unlike previous earnings periods, you need both sales and earnings to surprise -- we have been content for a while with just earnings. Plus, you have to have a noticeable percentage of the sales increase that is above what the Street was looking for come from an organic base -- meaning new products that didn't exist until very recently.
Alcoa, for example, introduced lithium composite aluminum, which is stronger and lighter and ideal for aircraft. PPG introduced some coating upgrades that the highest-end German auto manufacturers seemed to crave. Intel created some form factors that rather clearly blew away the competition, the now wilting Advanced Micro Devices (AMD). Honeywell crafted some new solutions for the refining of oil and gas that seemed to have had a real impact on its UOP division -- the part of the company dedicated to getting as much refined product as possible out of a barrel of any kind of oil.
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