8 Top-Rated Stocks With the Best Earnings Outlooks

Editor's Note: This article was corrected to show analysts' estimates for Nike are for the current fiscal quarter, not the quarter just ended.

BOSTON ( TheStreet) -- Many investors are in a quandary about where to put their money, given the continuing jitters over Europe's economy and the paltry bond yields here at home.

What's more, earnings season, which began Monday, is expected to disappoint as the majority of companies are seen struggling to beat the 2% year-over-year average increase analysts projected at the end of the first quarter. That adds to the pessimism for equities.

Yet there remain many high-quality stocks that are expected to continue to grow their earnings at a much faster pace than their peers, are relatively cheap, and given their predictable histories and healthy balance sheets, should see investors through the turbulence projected for the balance of the year in fine shape, helped by dividend yields that range from 1.25% to 2.8%.

S&P Capital IQ, which creates various types of model stock portfolios, highlights many of them in its "high-quality capital appreciation" portfolio. Eight stocks from that portfolio, summarized below, have an "A" rating from the firm as they have an above-average 10-year history of earnings and dividend growth and a history of stability in all types of economies.

They also have earned among the firm's top total return notations of four stars, which means they are expected to outperform the S&P 500 over the next 12 months, or five stars, connoting outperformance of the index by a wide margin.

As a group so far this year, their share performances are disappointing, as they are underperforming the S&P 500's 9% gain, with an average total return of 6.5%.

But given the slowing earnings growth expected for most members of the S&P 500, these firms' outlooks for the year -- ranging from transportation and logistics firm's C.H. Robinson Worldwide ( CHRW) 6%, to the 19% of media conglomerate Walt Disney ( DIS) and building industry supplier Fastenal ( FAST) -- make these companies look undervalued.

Here are eight stocks of companies that are rated "A" or "A+" by S&P, with strong earnings growth prospects and healthy dividends, presented in inverse order of analysts' earnings per share growth projections for this year:

8. C.H. Robinson Worldwide ( CHRW)

Company profile: C.H. Robinson, with a market value of $10 billion, is a global provider of multimodal transportation and logistics services. It has offices in North America, South America, Europe, and Asia. The company leverages its network of shippers and carriers in order to reduce shippers' transportation costs. Its business is closely tied to the trading activity of the world's economy.

Dividend Yield: 2.18%

Investor takeaway: Its shares are down 12% this year, but have a three-year, average annual return of 7.4%. Analysts give its shares four "buy" ratings, two "buy/holds," 20 "holds," and one "weak hold," according to a survey of analysts by S&P.

S&P has it rated "buy," with four stars, and an $85 price target, which is a 40% premium to the current price. It says the company has a "history of strong returns on assets and equity relative to most other transportation companies," and it has no long-term debt and has been a generator of cash over the past few years.

Analysts' consensus estimate is for earnings of 68 cents in the second quarter, up from 67 cents last year on the way to $2.78 per share on the year, versus $2.62 last year, an increase of 6%.

7. Nike ( NKE)

Company profile: Nike, with a market value of $41 billion, is the world's leading designer and marketer of high-quality athletic footwear, sports apparel and accessories.

Dividend Yield: 1.58%

Investor takeaway: Its shares are down 4.5% this year and have a three-year, average annual return of 22% and 10% over five years. S&P has it rated "buy" with four stars and a $100 price target (down from $130 at the start of the year), a 10% premium to the current price. Analysts give its shares 10 "buy" ratings, four "buy/holds," and 10 "holds," according to a survey of analysts by S&P.

Analysts expect it will earn $1.13 per share in the current quarter, its first of fiscal 2013, on the way to earnings of $5.12 per share for the year. The company reported fourth quarter, 2012 earnings of $1.17 per share on June 28.

6. Automatic Data Processing ( ADP)

Company profile: Automatic Data Processing, with a market value of $28 billion, is in the human resources administration services industry as a provider of payroll processing and benefits administration.

Dividend Yield: 2.8%

Investor takeaway: Its shares are up 5% this year and have a three-year, average annual return of 21%. Analysts give its shares eight "buy" ratings, four "buy/holds," 14 "holds," one "weak hold," and one "sell," according to a survey of analysts by S&P.

S&P has it rated "buy" with four stars, and a $63 price target, a 14% premium to the current price.

Analysts' consensus estimate is for earnings of $2.74 per share this year, or 9% growth, followed by earnings of $2.99 in 2013. S&P says of ADP that "over the longer term, we think the market for payroll outsourcing is relatively untapped, especially in the small and medium-sized business market and overseas, providing opportunities for future growth."

5. Target ( TGT)

Company profile: Target, with a market value of $38 billion, operates 1,515 discount stores, including 875 with P-fresh sections featuring expanded grocery lines; and 252 SuperTargets.

Dividend Yield: 2.48%

Investor takeaway: Its shares are up 14.6% this year, and have a three-year, average annual return of 18%. Analysts give its shares 10 "buy" ratings, five "buy/holds," and 11 "holds," according to a survey of analysts by S&P.

S&P has it rated five stars and a "strong buy," with a price target of $72, a 24% premium to the current price. Analysts' consensus is for earnings of $1.01 per share in the most recent quarter, up 7% year-over-year, on the way to $4.36 per share on the year, a 12% increase in annual earnings.

4. CVS Caremark ( CVS)

Company profile: CVS, with a market value of $60 billion, is one of the nation's largest retail pharmacy chains now coupled with one of its biggest pharmacy benefit managers, after its 2007 merger with Caremark.

Dividend Yield: 1.35%

Investor takeaway: Its shares are up 19% this year and have a three-year, average annual return of 17%. S&P rates it "strong buy" with five stars and a $56 price target, which is a 19% premium to its current price of $47. Analysts give its shares 10 "buy" ratings, 10 "buy/holds," and four "holds," according to S&P.

Analysts' consensus estimate is for earnings of 80 cents per share in the second quarter, an 11% rise year-over-year, on the way to $3.33 per share for the year, a rise of 13% over last year.

3. International Business Machines ( IBM)

Company profile: IBM is one of the world's largest and most respected information technology companies. Its product line includes system hardware, infrastructure software, outsourcing, and systems integration services. Customers tend to stick with Big Blue after spending on one of its typically expensive systems, which means steady, recurring revenue for the company. Its geographic and product diversity helps it stay stable and predictable in any economy.

Dividend Yield: 1.44%

Investor takeaway: Its shares are up 7.4% this year and have a three-year, average annual return of 26%. Analysts give its shares eight "buy" ratings, four "buy/holds," 15 "holds," one "weak hold," and one "sell," according to a survey of analysts by S&P.

S&P has it "buy" rated with four stars and a $227 price target, which is a 16% premium to the current price. Analysts' consensus estimate is for earnings of $15.05 per share this year, which is 15% growth, and $16.52 next year, or 10% growth. IBM has set a goal of operating earnings of $20 per share by 2015.

2. Fastenal ( FAST)

Company profile: Fastenal, with a market value of $12 billion, provides building industry and industrial customers with all types of fasteners such as nails and screws as well as general-purpose maintenance, repair, and operations items. With more than 2,600 store and distribution locations, it generated $2.8 billion in revenue in 2011. The company's results are closely tied to that of the construction industry, which is performing slower than expected.

Dividend Yield: 1.67%

Investor takeaway: Its shares are down 6% this year, but have a three-year, average annual return of 39% and over 15 years have an average annual return of 18%, one of the best records you will find. Analysts give its shares two "buy" ratings, nine "holds," and two "weak holds," according to a survey of analysts by S&P.

S&P has it rated "strong buy," with five stars and a $60 price target, which is a 48% premium to its current price of $40.68. For fiscal 2012, analysts estimate it will earn $1.44 per share, including 37 cents in the second quarter, which is up 19% over last year. It's expected to grow annual earnings by 19% to $1.71 per share in 2013.

1. Walt Disney ( DIS)

Company profile: Walt Disney, with a market value of $86 billion, is a media and entertainment conglomerate with diversified global operations in theme parks, cruise lines, filmed entertainment, television broadcasting and merchandise licensing. Media networks make up 46% of revenues and 70% of operating earnings and include the ABC broadcast network; 10 TV stations; and majority stakes in the cable networks ESPN, The Disney Channel and ABC Family.

Dividend Yield: 1.25%

Investor takeaway: Its shares are up 28% this year and have a three-year, average annual return of 29%. Analysts give its shares nine "buy" ratings, 10 "buy/holds," and 15 "holds," according to a survey of analysts by S&P. S&P has it rated "strong buy" with five stars and a $52 price target, an 8% premium to the current price. Analysts expect it to earn $2.99 per share this fiscal year (it reported 63 cents in its second fiscal quarter) up 19% from last year.

Disclosure: TheStreet's editorial policy prohibits staff editors and reporters from holding positions in any individual stocks.

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