Air Transport Services Group

Finally, Air Transport (NSDQ: ATSG) broke out of its holding pattern when it reported earnings Nov. 3. Revenue of $193 million rose 36% and beat estimates by $10 million. Earnings per share were up 40% to 14 cents and in line with expectations. Demand for Air Transport’s planes, which are the perfect size for delivering packages, remains strong. Amazon will take on another five 767-300 planes in early 2017, with a second customer submitting a new order for five 767-300s to be delivered the second half of 2017. Earnings have been slightly depressed because of a pilot shortage, which spiked pay rates above normal. Air Transport management sees that incremental expense diminishing in 2017, as newly recruited pilots come on board.

Ambarella

I am still super excited about Ambarella (NSDQ: AMBA), a position we just added. The Consumer Electronics Association expects that 2.8 million consumer drones will sell in the U.S. this year. Ambarella’s customer, DJI, a Chinese drone maker, produces almost half of those drones. Its recently launched Mavic Pro drone is getting rave reviews for its small size and long battery life. The drone has foldable blades that make it small enough to fit in your hand and an object avoidance system to prevent crashes. I expect to hear more about the demand for Ambarella’s chips, which power the camera on this drone, when the company reports earnings Dec. 1.

Camping World

Camping World (NYSE:CWH) reported its first quarter as a public company. Earnings leaped 18% as the retailer of new and used RVs saw a boom in lower-priced trailers to first-time, younger buyers. This demographic is bringing a whole new wave of demand to RV makers. Sales of roadside assistance and service plans, which generate significantly higher profits than RVs, rose 11%. Product profit margins rose from 27% to 28%, thanks to improved profits on service plans and higher insurance sales. The company paid off $200 million of debt with the proceeds from its initial public offering, prompting credit upgrades from Moody’s and Standard & Poor’s and reducing the amount of interest Camping World pays in future quarters.

Charles River Labs

Charles River (NYSE: CRL) reported a healthy third quarter Nov. 2. Earnings were $1.18 per share, up 16%, beating estimates by 5 cents. Management raised the low end for annual EPS estimates by 4 cents. Revenue was a bit weaker than expected after some large pharmaceutical customers had to delay drug trials. Revenue from smaller biotech customers, however, continues to grow by double digits. This revenue will be booked in the fourth quarter. Charles River stock dropped in conjunction with the entire pharmaceutical sector as investors feared the possibility of price controls from a Hillary Clinton presidential victory and a pending drug price reform bill in California. Instead, both suffered defeats on Election Day. I expect the stock to rally from here.

Criteo

It was a stupendous quarter for Criteo (NSDQ: CRTO), which reported earnings Nov. 2. The stock, which has been hit hard by fears of a slowdown in mobile advertising, rose 9% as the number of shares traded swelled to four times the stock’s average volume. Long-time subscribers know I pay special attention to big stock moves on outsize volume. Not only did Criteo handily beat estimates almost 30% but also surpassed revenue estimates for the quarter by $3 million and gave guidance for a stronger than expected fourth quarter. Criteo’s EPS almost tripled to 48 cents, with a 33% jump in revenue. By comparison, new IPO The Trade Desk (NSDQ: TTD) grew revenue 80% but did not grow earnings as quickly. Criteo has all the pieces in place to continue capitalizing on the mega growth in mobile advertising. I’ll be looking for more information when the company presents at an industry conference Nov. 18.

Drew Industries

In its quarterly report Drew Industries (NYSE: DW) drove home some good numbers Nov. 3. Earnings per share were $1.19, in line with estimates and up 70% from last year. Revenue was up 19% and a few million dollars higher than expected. Management’s comments mirrored those from other companies in the industry, including portfolio holding Patrick Industries and customer Thor. Entry level, lower-priced trailers are driving the highest growth in the RV market. Although this means a slower increase in content per vehicle for Drew, higher units will continue spurring revenue higher. The company noted strong orders from dealers at the annual Elkhart Dealer Open House in September, when dealers start placing bets for demand in the spring.

Gypsum Management and Supply

Since our recommendation, Gypsum Management and Supply (NYSE: GMS) made two more acquisitions. It bought Ryan Building Materials, a Michigan-based interior-building supplies company, and United Building Materials, an Ohio-based supplier of drywall, metal framing and acoustical ceilings. A significant part of GMS’s growth strategy is based on expanding geographically through small acquisitions. The company also refinanced a portion of its debt at lower interest rates, which should increase annual earnings per share 2 cents.

Lydall

Materials company Lydall (NYSE: LDL) is up 26% since our recommendation and looks like it’s going higher. The company reported a tremendous quarter Nov. 1. Earnings per share of 86 cents grew 50% and were 20 cents higher than expected. Lydall saw strong growth in its thermal acoustics metals business, which counts automakers among its customers. Despite a hiccup in production from one of those customers, Ford Motor, Lydall anticipates growing faster than the overall auto market as carmakers include more of the company’s materials in each car. Management remains super bullish about its recently acquired Texel business, which will benefit from infrastructure investments. Lydall generated $47 million in cash flow in the first nine months of the year, up from $14 million for the same period a year ago.

Masonite

Masonite (NYSE: DOOR) slammed the door on bears when it reported third-quarter earnings Nov. 9. Subscribers may remember the stock dropped hard in August, when larger investments in its manufacturing facility caused the company to miss estimates. Those investments have already begun to pay off, with profits rising 43% to 89 cents per share, beating estimates by 18 cents. The stock jumped 10% on the news and is now up 16% since its recent low. I expect Masonite to continue climbing higher as profits expand from sales of more profitable doors and a higher sales volume from home builds and remodels.