Amongst the thousands of stocks that reported their profits (or losses) over the past month, there were a handful of stocks that really caught my attention with some excellent results.
Here are three of my favourite stocks that reported better-than-expected results this reporting season:
Cochlear Limited (ASX: COH)
Cochlear shareholders have had to endure a couple of difficult years but it now looks like the company is back on the right track.
Its FY15 result was vastly improved from previous years, with record sales and earnings per share (EPS) increasing by 56%.
The growth in the American market was a clear stand-out with sales growth of 15% and the lower Australian dollar also helped to boost the bottom line by $24.9 million.
Importantly, sales momentum increased in the second half of the year and this is expected to continue into FY16.
Cochlear also provided FY16 guidance of 13-20% profit growth based on the Australian dollar at 75c.
Although the shares are trading at 32x earnings, the long-term potential for Cochlear remains exciting, with the share price likely to get a boost in the short term from a potentially lower Australian dollar.
Magellan Financial Group Ltd (ASX: MFG)
Magellan has been a star performer on the ASX for more than five years and its most recent profit result did not disappoint.
EPS increased by a whopping 108% with the full year dividend increasing by a similarly impressive 96%.
The global fund manager experienced a 55% increase in funds under management in FY15 and this significantly boosted its management fees. Magellan also produced excellent returns on its managed funds and this helped the company to earn an additional $41.3 million in performance fees over the year.
The outlook for Magellan remains positive as the demand for international equities is expected to increase steadily over the next decade.
With a strong management team and enviable track record, the current valuation of 17.5x earnings certainly looks attractive.
Ramsay Health Care Limited (ASX: RHC)
Ramsay is another stock that has been a star performer on the ASX for more than 15 years and is one stock that deserves to trade at a premium to the broader market.
Its FY15 result was impressive with earnings per share and dividends increasing by 20% and 18.8% respectively.
Pleasingly for investors, its acquisition of France-based hospital operator Générale de Santé has been performing above expectations and now makes Ramsay the leading private hospital operator in France.
With the demand for private healthcare likely to increase as government budgets around the world struggle to fund the ever expanding medical needs of an ageing population, Ramsay is well placed to take advantage of this trend.
FY16 is likely to be another record year with Ramsay guiding for EPS growth of 12-14%.
Although the shares are trading at more than 30x earnings, I think investors who have the chance to buy shares under $60 should take the opportunity to do so as the share price is likely to be higher in years to come.
