MCKESSON CORP. $57 (New York symbol MCK; Aggressive Growth Portfolio, Consumer sector; Shares outstanding: 266.1 million; Market cap: $15.2 billion; Price-to-sales ratio: 0.1; WSSF Rating: Average) is the largest wholesale distributor of pharmaceutical drugs in the U.S. and Canada. It also owns 49% of Mexico’s largest drug distributor. Its customers include over 40,000 pharmacies, as well as doctor’s offices, hospitals and clinics. Aside from drugs, the company sells surgical tools and health and beauty products. McKesson’s revenue rose 32.4%, from $80.5 billion in 2005 to $106.6 billion in 2009 (its fiscal year ends March 31). Earnings rose 82.8%, from $653.3 million in 2005 to $1.2 billion in 2009. McKesson aggressively buys back shares, so earnings per share rose 96.3%, from $2.18 in 2005 to $4.28 in 2009.

New payment system cuts risk

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3M COMPANY $71 earned $1.20 a share in the three months ended June 30, 2009, down 13.7% from $1.39 a year earlier. These figures exclude costs related to 3M’s cost-control plan, including layoffs and early-retirement offers. 3M makes over 50,000 industrial and consumer products, and the recession caused sales to fall by 15.1%, to $5.7 billion from $6.7 billion. Despite this, 3M’s restructuring let it increase its gross profit margin (gross profits as a percentage of sales) to 22.6% from 22.1% a year earlier. Buy. QUAKER CHEMICAL CORP. $23 cut 10% of its workforce earlier this year due to slowing demand for its lubricants. But thanks to these savings, its gross profit margin rose to 35.2% in the second quarter of 2009 from 28.3% a year earlier. Quaker uses oil to make its products, so it also gained from lower oil prices. Because of its lower costs, Quaker should be able to keep paying quarterly dividends of $0.23 a share, for an annual yield of 4.0%. Buy. BUCKEYE PARTNERS L.P. $46 continues to increase its quarterly distributions. It will pay $0.9125 a unit in the third quarter of 2009, up 1.4% from the second quarter. The new annual rate of $3.65 yields 7.9%. Savings from Buckeye’s plan to streamline its pipeline system, which pumps gasoline and other fuels, should give it more cash flow, which it may use for further distribution increases. Best Buy.

HEWLETT-PACKARD CO., $44.78, New York symbol HPQ, reported revenue of $27.5 billion in its third quarter, which ended July 31, 2009. That’s down 2.1% from $28 billion a year earlier. The revenue drop came despite Hewlett’s $13.9-billion purchase of Electronic Data Systems (EDS) in August 2008. Thanks to EDS, revenue at Hewlett’s computer-services business jumped 93% in the latest quarter, to $8.5 billion, or 31% of total revenue. However, this was more than offset by lower sales of computers, printers and software. Hewlett continues to cut its costs in response to the slow sales. As a result, earnings rose 1.0%, to $2.21 billion from $2.19 billion. Earnings per share rose 5.8%, to $0.91 from $0.86, on fewer outstanding shares. These figures exclude the cost of integrating EDS. On this basis, the latest earnings beat the consensus estimate of $0.90 a share....

FAIR ISAAC CORP., $24.13, symbol FICO on New York, has changed its ticker symbol on the New York exchange from FIC to FICO. The new symbol is part of the company’s plan to change its corporate identity. Its main business remains its FICO software, which lets lenders of all types calculate a customer’s credit score. Fair Isaac Corporation is still the company’s legal name. The stock has rebounded sharply from last March’s low of $9.76. Aggressive cost cuts are letting Fair Isaac increase its profits in the face of falling sales. It has also recently upgraded its FICO scoring system. This should help it gain from rising demand for credit scores as the economy recovers....

RUGGEDCOM INC. $20.55 (Toronto symbol RCM; SI Rating: Speculative) (1-888-264-0006; www.ruggedcom.com; Shares outstanding: 12.1 million; Market cap: $248.6 million) makes computer-networking equipment that is used in harsh environments. The company’s products are designed to reliably operate under high levels of electromagnetic interference, wide variations in temperature and humidity, and high levels of vibration and exposure to dust. They also function while exposed to such things as corrosive gases and water. RuggedCom’s products include Ethernet switches that connect computers together and let them exchange data at high speeds. It also makes Internet-based communications networks that are faster and more functional than systems that are now used in harsh environments. In the three months ended June 30, 2009, RuggedCom’s revenue rose 25.6%, to $16 million from $12.8 million a year earlier. (All figures except share price and market cap in U.S. dollars.) Earnings per share fell 53.3%, to $0.07 from $0.15. Higher one-time costs, such as moving to a new plant and a jump in the Canadian dollar, were the main reason for the earnings drop. Research costs also rose. However, RuggedCom booked a record $18.1 million in new orders. That’s 40.2% more than a year earlier....

RuggedCom may sound vaguely familiar to longtime readers. Nearly a decade ago, we recommended a stock called DY 4 Systems, with a remarkably similar story. DY 4 made computers for harsh industrial and military environments — much like RuggedCom. The difference is that DY 4 focused on individual computers. RuggedCom has moved on to networking and the Internet. Like RuggedCom, DY 4 had annual revenue in the $60 million area, and was spending 11.8% of revenue on research. DY 4 seemed a dull selection to some in that Internet-crazed era, but it still moved up irregularly for us and was subsequently taken over for a 112.5% gain....

SYMANTEC CORP. $15.22 (Nasdaq symbol SYMC; SI Rating: Average) (1-408-517-8000; www.symantec.com; Shares outstanding: 814.5 million; Market cap: $12.4 billion) makes software that protects computers from viruses and electronic attacks. The popular Norton anti-virus program is its best-known product. In the three months ended July 3, 2009, Symantec earned $73 million, or $0.09 a share. That’s down 57.6% from $172 million, or $0.20 a share, a year earlier. If you exclude unusual items, including writedowns of securities and gains on the sale of assets, per-share earnings fell 15.0%, to $0.34 from $0.40. That fell just short of the $0.35 a share that analysts were expecting. As well, the company continues to spend around 15% of its revenue on research, so it’s more profitable than it looks. Revenue fell 13.2%, to $1.43 billion from $1.65 billion. Analysts were expecting $1.49 billion. The recession has prompted businesses to put off investments in computer software and storage products. However, Symantec was able to partly offset this by launching several new consumer products during the quarter. These helped it sell more of its Norton antivirus and Internet-protection software to individuals....

CYBERPLEX $1.58 (Toronto symbol CX; SI Rating: Speculative) (416-597-8889; www.cyberplex.com; Shares outstanding: 65.2 million; Market cap: $103.1 million) continues to report higher revenue and earnings. In the three months ended June 30, 2009, Cyberplex’s earnings rose more than fivefold, to $1.1 million, or $0.02 a share, compared to $206,522, or nil per share. Its revenue jumped 171.6%, to $25.7 million from $9.5 million a year earlier. The company operates in a complex and ever-changing market. Still, it should continue to benefit as the economy recovers and consumer spending rises....

LOJACK CORP. $5.52 (Nasdaq symbol LOJN; SI Rating: Speculative) (www.lojack.com; 781-326-4700; Shares outstanding: 18.1 million; Market cap: $99.8 million) sells systems that help track and recover vehicles after they’ve been stolen. Lojack operates in the U.S. and 30 other countries. The company’s Canadian subsidiary is Boomerang Tracking. In the three months ended June 30, 2009, LoJack’s revenue fell 31.1%, to $35.4 million from $51.4 million a year earlier. It lost $0.67 a share, compared to a profit of $0.06. However, LoJack was forced to write down the value of Boomerang Tracking during the quarter. Without this, it made a profit of $0.09 a share. Its $17.3-million debt is just 17.6% of market cap, and less than 32% of its cash holdings of $54.2 million. Because the U.S. accounts for over 75% of its revenue, LoJack will need a rebound in American new-car sales to show substantial growth. In the meantime, it will benefit from its efforts to find new uses for its locator technology. These include tracking and recovering people with special needs who are in distress, as well as cargo and hazardous materials....

INTUITIVE SURGICAL $222.51 (Nasdaq symbol ISRG; SI Rating: Average) (515-507-5000; www.intuitivesurgical.com; Shares outstanding: 37.9 million; Market cap: $8.4 billion) is up over 30% since it reported improved results in the latest quarter. In the three months ended June 30, 2009, revenue rose 18.9%, to $260.6 million from $219.2 million a year earlier. Earnings climbed 21.9%, to $62.4 million, or $1.65 a share, from $51.2 million, or $1.32. These results beat analysts’ expectations of $1.25 a share in profits on revenue of $230 million. The company’s results continue to improve, despite the recession, which has prompted hospitals to cut spending....