As we roll into the 2nd quarter earnings season, several of the 5 have reported earnings already. The list:

Apple, Inc. (AAPL: 258.77 0.00 0.00%) Today Apple reported earnings that were 15% higher than the same quarter last year. The $1.35 per share net beat the estimates by 18¢. Apple just keeps making products people want to buy and they get premium prices for them.

The Coca Cola Company (KO: 57.56 0.00 0.00%) Coke is a monster when it comes to selling their products around the world. Earlier this week the company reported profits 43% higher than a year earlier. Coke earned 88¢ per share compared to 61¢ for Q2, 2008 and 65¢ in the first quarter of 2008. 80% of the company’s sales are outside of the U.S. and think about how much Coke products Americans drink.

Google, Inc. (GOOG: 470.30 0.00 0.00%) continues to grow profits despite the economic slowdown everywhere. For the 2nd quarter Google had revenues 3% higher than an year earlier (remember the 2nd quarter of 2008, GOOG was $580 per share). Net income increased by 74¢ to $4.66 per share.

IBM Corp. (IBM: 127.58 0.00 0.00%) had reinvented itself from a hardware company to a service contract provider. Revenues and earning move steadily upward. As one headline put it, “IBM is a Profit Machine“.  2nd quarter earnings of $2.32 per share beat the estimates by 15% and were 18% higher than a year earlier.

McDonald’s Corp. (MCD: 75.09 0.00 0.00%) reports earnings tomorrow (Thursday) and the estimate is 97¢ per share compared to earnings of 86¢ a year ago and 82¢ in the 1st quarter of 2009. Let us see how they do.

These companies continue to grow their businesses and surprise the experts. Take a look at what the market did to their stock prices in November and March. Walmart (WMT: 52.04 0.00 0.00%) is another company close to making the list. I like to research and own small cap stocks, but these companies will treat long term investors well and we can all learn from the success of superior business plans put into action.

Panama based airline holding company Copa Holdings, S.A. (CPA: 51.51 0.00 0.00%) has proven once again that a airline can actually make money. Copa is the holding company for Copa Airlines and Aero Republica. The two airlines now serve 45 destinations in 24 countries including several in the U.S.

As an airline here are some of the things I think Copa does right. I have flown the airline several times and have first hand experience with their service.

• A fleet of only two models of modern, fuel efficient aircraft.
• Excellent customer service and on-time flights.
• Controlled expansion into a growing regional market.
• An easy to understand and consistent fare system.

On the financial side, Copa had an excellent 4th quarter. During the 2nd and 3rd quarters the company had sub par results (but still profitable) due to a massive increase in fuel costs. For Q4 of 2008, CPA had net income of $1.20 per share, a 46% increase from the same quarter of 2007. Excluding special items, the net was $1.48 per share. For all of 2008 Copa earned $3.50 per share compared to $3.72 in 2007. Excluding non-cash, mark-to-market fuel hedge adjustments the net for the year was $3.97. At the end of 2008 Copa had $408 million in cash or 32% of annual revenues.

The global economic slow down does not seem to be affecting Copa. Traffic growth in January was 15%. The company generates approximately 50% of their business out of Panama, which is projected to have GDP growth of 4% to 6% for 2009. Company management is forecasting business growth of 13% for 2009. Consensus estimates have CPA earning $4.21 for 2009 however, I see the company easily making $4.50 based on the 4th quarter results, low energy costs and projected growth factors.

In normal times, CPA would be a $50 stock. I hope at some point in the near future the market realizes that there still are companies that can grow their businesses and profits.

Note: CPA is a component of this site’s Opportunities Portfolio.

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• Dow Jones Industrials: 7,365.67….7,226.29
• S&P 500: 770.05….741.02
• Nasdaq: 1,441.23….1,295.48

The DJI is less than 2% above the recent low but the Nasdaq has another 10% to fall before cracking the recent low. In November, we were in the midst of all of the 4th quarter economic turmoil that is resulting the bad results we are seeing now. I think the market is reacting again to the same stimuli. With more government stimulus money coming, leading economic indicators turning positive and my favorite, the Baltic Dry Index continuing to climb, I see at least a 50% possibility of the economy turning to positive growth as early as the 2nd quarter of 2009. Too many pundits are pushing their predictions of the recovery dates further out based on news that is really from the last quarter of 2008.

With the market crapping on everything it is difficult to try to write in depth analysis of interesting stocks. Their fortunes will not turn until market sentiment does, no matter how compelling their story. So here are a few brief notes on stocks that released earnings this week:

Bladex, the  Banco Latinoamerico de Exportaciones (BLX: 13.35 0.00 0.00%) reported earnings for the year of $1.51 per share compared to $1.98 in 2007. During the 4th quarter the bank called in aboout 20% of their outstanding loans, those that they considered the most risky. They currently have 0% non-performing loans. Bladex is in excellent financial shape and their niche of providing trade credit in Latin America has lost most of its competition. Bladex is now in a strong defensive position and is ready to resume growth when regional trade recovers. BLX historically has traded within a few percent of its book value, currently $15.77 per share.

Silver Wheaton (SLW: 23.89 0.00 0.00%) reported a paper loss for the 4th quarter on a $64 million non-cash write down on long term investments. Silver prices averaged less than $11 per oz. during the quarter compared to $14 in the previous quarter. Silver is again trading around $14. SLW sold 11.1 million oz. of silver in 2008, a drop of 2 million oz. from 2007 and is projecting sales of 15 to 17 million for 2009. Silver Wheaton has been in the potential is in the future quarters camp for the  2 years I have been watching the stock. Hopefully, someday that future will get here. Rising silver prices and silver sales could at some point make this a hugely profitable company. I keep the stock in this site’s portfolio because I still believe it is an excellent way to have precious metal exposure. SLW is the only stock in positive return territory for my Opportunities Portfolio, which kicked off on October 1, 2008.

Note: SLW and BLX are components of this site’s Opportunities Portfolio. I also hold a personal small position in SLW.

I started up the actively managed version of this portfolio on October 1, 2008. The portfolio holds stocks that I think have potential for significant returns from all stock picking disciplines: growth, value, international and unique stories. I personally have positions in a significant number of the stocks in the portfolio, but not all of them.

The portfolio started out on 10/1 with about 20% in cash and the stock positions weighted by my analysis of relative risk vs. reward. Those I considered more stable companies had larger weightings and the more speculative issues were smaller positions. As you probably know, October 1 was the start of the steepest decline of the recent bear market. The market went what seemed like straight down for 6 weeks and at one point the portfolio was down 48%, even with a relatively large cash position. As the market fell I added to several of the stock positions and have invested about 60% of the starting cash.

Portfolio performance for the 3 months ending on 12/31/2008 was a negative 26.9%. Of the 18 positions in the portfolio and the end of the year, only 2 showed positive returns: Silver Wheaton (SLW: 23.89 0.00 0.00%) had gained 17% and the share price of Nordic American Tanker (NAT: 27.71 0.00 0.00%) was up 5% and NAT had earned a dividend equal to 5% of the entry price.

The “top” losers in the portfolio were Green Hunter Energy (GRH: 0.56 0.00 0.00%) off 46%, Atlas Energy (ATN: 30.19 0.00 0.00%) down 43% and Terra Industries (TRA: 45.76 0.00 0.00%) also off 43%. Three stocks had been sold out of the portfolio, all losers. Star Bulk Carriers (SBLK: 2.87 0.00 0.00%) was sold for a 43% loss, Ashford Hospitality Trust (AHT: 9.24 0.00 0.00%) left down 35% and the bankruptcy of VeraSun Energy resulted in a 92% loss on the position.

As I write this the 3 largest holdings in the portfolio are KHD Humboldt Wedag (KHD: 0.00 N/A N/A), Aegean Marine Petroleum (ANW: 16.30 0.00 0.00%) and Atlas Energy (ATN: 30.19 0.00 0.00%). Approximately 40% of the portfolio is in international or global stocks. I am looking for places to put some of the cash to work and keep gravitating to South American companies, but want to make sure the bear is out of the woods before I make a serious move. The portfolio currently has $3,407 in cash.

Note: This Portfolio is hypothetical and does not 100% reflect my personal holdings. The discussion and data on the portfolios are for informational purposes only and are not meant to be investment or trading advice.