Acuity Brands

Acuity Brands has bounced 6% since its earnings miss on Jan. 10. An analyst at Wells Fargo encouraged investors to buy the stock last week. After meeting with Acuity’s management, the brokerage firm expects Acuity (NYSE: AYI) to disclose another customer similar in scope to Target this year. The firm notes that mid-quarter channel checks on the company showed that demand flow rebounded in January. Several building-related companies also have seen a temporary pause in demand this winter, as customers digest possible new fiscal policies that the Trump administration is considering. Because industry data suggests long-term solid demand, I expect orders to bounce back even more. Acuity will report its second quarter in early April.

Charles River Labs

Charles River jumped 8% last week when it beat estimates handily. Earnings per share grew 21% to $1.21, 10 cents higher than expected. Revenue, boosted by Charles River’s (NYSE: CRL) purchase of WIL Labs last year, rose 32% to $467 million, $25 million higher than estimates. The company also increased estimates for 2017 based on robust demand, particularly from biotech companies. These customers often do not operate research labs and outsource the bulk of their laboratory testing to companies like Charles River. The outlook was particularly bullish when compared to the dour outlook that competitor Quintiles, which has lost some big contracts, provided last week.

Chemours Co.

Chemours Co. jumped almost 13% Feb. 13 on the news that it had settled litigation, with prior parent DuPont sharing the bill. As I noted in my Feb. 9 buy recommendation, a huge risk of Chemours (NYSE: CC) stock was the potential for a lawsuit regarding DuPont’s plant in Ohio. The settlement news considerably lessens that risk. On Wednesday Feb. 15, Chemours reported lower-than-expected fourth-quarter earnings.The shortfall, however, was due to expenses associated with the legal settlement and increased investment in a new manufacturing plant for the company’s low-global-warming coolant Opteon. Management expects continued vigorous demand for Opteon because of regulatory changes.

Integrated Device Tech

Integrated Device Technology (NSDQ: IDTI) reported a solid quarter, but the stock is stuck in neutral. Although guidance for the March quarter frames current estimates, the low end misses analysts’ expectations. I also suspect that because some fellow chip makers blew away estimates, hopes were riding high for a huge earnings beat. Earnings per share for the third quarter were 1 cent better than expected, and guidance for fourth-quarter earnings (ending March) is expected to range between 32 cents and 36 cents, versus estimates of 36 cents. The company has done an excellent job of gaining automotive customers and noted that sales to these customers now equal 10% of total revenue. Last week, Integrated Device acquired optical chip maker GigPeak for $250 million in cash. The deal will add to earnings and gives Integrated an edge in the optical business.  

Impinj

Impinj dropped a striking 12% last week when it reported its fourth quarter. Despite beating revenue and earnings estimates, investors fretted over lower earnings guidance for the first quarter. Although revenue is expected to be $2 million higher than expected, earnings per share will be lower than the estimate of 2 cents. It is not unusual for a tech company to choose increased spending over higher profits. I do not view this as a negative. As I expected, management would not confirm or deny a relationship with Amazon. It did note that Amazon recently joined the RAIN alliance, which supports Impinj’s (NSDQ: PI) technology. In addition, management confirmed that its RAIN technology works on smartphones, a supposed knock against Amazon using the technology for “checkout-less” stores.

Vulcan Materials

Vulcan Materials reported a profit of 80 cents a share, missing forecasts for 83 cents on revenue of $873 million and coming in below expectations for $914 million. Shares dropped as low as $120 before rebounding a bit. Management noted a marked drop in orders the second half of December, which the company blamed partly on weather and partly on customer uncertainty due to the election. I’m keeping Vulcan (NYSE: VMC) on the buy list but am reviewing the assumptions that support my $165 target.