Stocks Set on Cruise Control (ADBE, PAYX, KMX, DRI, CLUB, ORN)

Stocks posted solid gains for the trading session on another relatively quiet day on Wall Street. Earnings were generally good, although we were expecting better results from Darden (DRI), which owns the Olive Garden, Red Lobster, and Texas Longhorn sit-down restaurant chains, among others. At this point, the market seems to be coasting into year-end, with little buying momentum or selling pressure unless a stock is impacted by an outside stimulus, such as an analyst upgrade or downgrade, earnings report, etcetera. When that occurs, though, there does seem to be a lot of piling in or piling on happening.

The Fitness and Dieting Stocks Index was the top performing tickerspy Index on the day, led by Town Sports International (CLUB) with a 14% gain. The Engineering and Construction Stocks Index was the day’s worst performing tickerspy Index, with Orion Marine Group (ORN) down -23%.

Stocks climbed on the day, with the Dow up 55 points to 11,533. The S&P jumped 8 points to 1,255, while the Nasdaq advanced 18 points to close at 2,668. Oil added 45 cents to $89.82 a barrel, while gold rose $2.70 to $1,388.80 an ounce.

In earnings news, shares of Darden Restaurants sank -5.7% after its quarterly same-store sales growth came in below expectations. For Q2, the operator of Olive Garden and Red Lobster earned $74.5 million, or 53 cents a share, up 24% from $60.3 million, or 43 cents a share, last year. Adjusted EPS was 54 cents, matching estimates. Revenue climbed 5% to $1.73 billion. Same-store sales moved up 1.4%, which came in below the company’s forecast of a 2% rise. The restaurant chain operator reaffirmed its FY11 forecast, saying it expects profits to grow 14-17% on sales growth of 5-6%.

Design software maker Adobe Systems (ADBE) issued a better-than-expected outlook for its first quarter, sending its shares up 6.0%. The company also announced its first billion-dollar quarter ever. For Q4, Adobe posted a profit of $268.9 million, or 53 cents per share, compared with a loss of -$32 million, or -6 cents per share, a year earlier. Adjusted EPS came in at 56 cents, which topped the consensus by 4 cents. Revenue jumped 33% to $1.0 billion. Looking forward, the company expects Q1 adjusted EPS of 54-59 cents on revenue of $1.00-$1.05 billion, which was above analyst expectations of 51 cents on revenue of $992 million.

Shares of Paychex (PAYX) were virtually flat after the company’s Q2 results beat estimates. For the quarter, the provider of payroll and benefit services earned $133.9 million, or 37 cents a share, up from $125.8 million, or 35 cents a share, a year ago. Wall Street was looking for EPS of 35 cents. Revenue grew 3% to $512 million, above the $510.6 million consensus. Sixteen Pros held the stock in their top-15 U.S.-listed equity positions at the end of Q3, and 314 tickerspy members hold the stock in their portfolios.

CarMax (KMX) saw its shares sink -7.6% despite posting better-than-expected Q3 earnings. For the period ended November 30th, the used car dealership chain earned $82.4 million, or 36 cents per share, topping the consensus by 2 cents. Last year, net income was $74.6 million, or 33 cents per share. Revenue rose 23% to $2.12 billion, while same-store sales climbed 16%. Sixteen Pros held the stock in their top-15 U.S.-listed equity positions at the end of Q3, and over 220 tickerspy members hold the stock in their portfolios.

Tags: ADBE, CLUB, DRI, KMX, ORN, PAYX