It would be fair to say that this earnings season has thrown up its fair share of surprises – both on the upside and downside!
The sheer volume of results that have come in over the past few weeks means it would be pretty easy for most investors to overlook some of the best reports of the season.
While there are many more companies that could be considered, I think the following five companies have delivered outstanding results for shareholders this time around:
Treasury Wine Estates Ltd (ASX: TWE) – The wine company was struggling only a couple of years ago but has managed to deliver a huge turnaround thanks to a savvy acquisition and a number of operational improvements. Strong demand from Asia has also helped to boost sales and its latest profit result showed earnings per share (EPS) growth of 45%. Treasury Wine expects the earnings momentum to continue strongly in FY17 with further sales growth and cost savings to boost operating margins.
Domino's Pizza Enterprises Ltd. (ASX: DMP) – The pizza maker continues to deliver stunning earnings growth and this time around managed to grow net profit after tax (NPAT) by 43.6%. The most impressive aspect of this result, I believe, was that much of the growth came organically from strong same store sales growth. Domino's expects another bumper year ahead with earnings expected to grow by 30%.
iSentia Group Ltd (ASX: ISD) – Investors had sold-off the shares of the media monitoring and intelligence company in anticipation of a weak report, but iSentia managed to calm investors nerves with EPS growth of 19%. iSentia shares have since bounced by around 25%, although they still hover well below their 52-week highs. The company is anticipating revenue and EBITDA growth in the low to mid-teens in FY17 before an acceleration of growth in the years following thanks to a range of new initiatives.
Corporate Travel Management Ltd (ASX: CTD) – Shares of the travel company reached a new all-time high of $18.24 on the back of a superb full year profit result that showed EPS growth of 54%. Impressively, the company generated record profits in each of its geographic regions and was able to grow profits at a faster rate than sales. Corporate Travel expects to deliver underlying profit growth of between 23-30% in FY17, but investors shouldn't be surprised to see even better results if the company's recent track record is anything to go by.
Bellamy's Australia Ltd (ASX: BAL) – The demand for Bellamy's organic infant food products continues to soar, with the company recording a 95% increase in sales in FY16. More importantly, the growth in sales is translating into higher profits with full year NPAT increasing by a staggering 322% to $38.3 million. Bellamy's didn't provide earnings guidance for FY17, but investors are expecting another year of strong sales growth coupled with the benefits of a company that is growing the scale of its operations.
Foolish takeaway
It is not surprising that every share above trades on a significantly higher valuation than the broader market when you consider just how impressive their earnings growth has been over the past 12 months.
Although none of them would be considered bargains at the moment, investors need to remember that sometimes its worth paying a little extra for higher quality shares.
