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10 Stocks With Explosive Earnings Growth: No. 8 DynCorp International (DCP)

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July 1, 2009 5:43 PM EDT

In the current difficult macroeconomic environment it is hard to find companies that are earning a meaningful profit, let alone growing earnings. But these 10 stocks have been rewarding investors with explosive earnings growth and stock performance to boot. You can track the entire series here.

Number 8: DynCorp International Inc. (NYSE: DCP)

DynCorp International is a leading provider of specialized, mission-critical professional and support services outsourced by the U.S. military, non-military U.S. governmental agencies and foreign governments. DynCorp's specific global expertise is in law enforcement training and support, security services, base and logistics operations, construction management, aviation services and operations, and linguist services.

DynCorp's customers include the U.S. Department of Defense, the U.S. Department of State, foreign governments, commercial customers and certain other U.S. federal, state and local government departments and agencies. Revenue from the U.S. government accounted for approximately 96%, 95%, and 97% of total revenue in fiscal years 2009, 2008, and 2007, respectively.

2009 was another record year for revenue, adjusted EBITDA and cash generation for DynCorp International.

Earnings Growth:

Since the fiscal year ended March 31, 2006, DynCorp International's net income has increased over 8x from $7.2 million to $69.8 million. EPS has increased over 430% from $0.23 to $1.22 per share in that time. For the fiscal year ended March 31 2009, DynCorp International grew EPS from $0.84 to $1.22, an amazing 45%!

Earnings Prospects:

For the fiscal year 2010, DynCorp International sees EPS of $1.42 to $1.54, which would represent growth of 16% to 26%. Analysts, on average, see EPS toward the high end of the company's range with the consensus currently at $1.51.

With a total backlog that has grown 5.7% to $6.3 billion as of April 3, 2009, and the exploding size of the U.S. government, DynCorp International earnings prospects look strong for years to come.

Stock Performance:

Shares of DCP are up 13% YTD, versus a 2% rise in the S&P 500. Over the last year, DCP is up 16% versus a 28% slide in the S&P 500. Over the last 5-years, DCP is up 14% versus a 30% slide in the S&P 500.