These Stocks Laugh at Wall Street

In these heady economic times, Mr. Market seems to enjoy dogpiling on any stock that dares to fall short of analysts' estimates. To defy that trend, we're here to celebrate stocks that didn't merely meet Wall Street's predictions, but laughed in analysts' faces by leaving their miserly forecasts in the dust. The companies below have all soundly trounced earnings estimates by 20% or more in the last quarter.

Sometimes a company will be forecast to lose money, but they'll upend the analysts' apple cart by recording profits. You can't actually calculate by how much they beat the estimates (7th-grade math tells us we can't divide by zero or less!), but it's still useful to understand why they were able to exceed expectations.

Company

CAPS Rating (out of 5)

Last Qtr. EPS Estimate

Last Qtr. EPS Actual

Est. LT Growth

American Superconductor (Nasdaq: AMSC  )

*****

$0.14

$0.20

20%

Clean Energy Fuels (Nasdaq: CLNE  )

*****

($0.04)

($0.03)

30%

Huntsman (NYSE: HUN  )

**

($0.12)

$0.27

3%

Source: Yahoo.com.

Nonetheless, beating estimates isn't enough to make a stock a winner. Analysts are notoriously lousy at forecasting results, and one-time items can sometimes push earnings over the top. Wall Street professionals typically don't include such extraordinary events in their forecasts.

Rather than focusing only on the past, we'll check whether analysts have a bead on future performance. With help from Motley Fool CAPS, we'll see which of the top companies listed above will have the last laugh.

Laugh, clown, laugh!
Interior Secretary Salazar's decision to approve the Cape Wind power project in the Nantucket Sound off Massachusetts' coast could be the impetus needed to get many more wind farms approved. While the immediate beneficiary is Siemens, which is providing the 130 turbines to be used in the project, as well as NRG Bluewater Wind, a subsidiary of NRG Energy (NYSE: NRG  ) , that wants to erect deepwater wind farms all along the east coast, you have to know T. Boone Pickens is smiling, too.

Although enough wind power installations were made last year to equal the energy output of three nuclear power plants, according to the American Wind Energy Association, it's still been a slow process for wind energy acceptance. The first quarter of 2010 saw the lowest level of installations since 2007, and Picken's Clean Energy Fuels has been a laggard, too. Of course, that might have just as much to do with the sorry state of natural gas these days, but Pickens plan to make wind power viable certainly got a kick start with the Cape Wind project.

Yet you can also see the short shrift wind energy gets when investors discuss Clean Energy Fuels. The focus on CAPS is almost exclusively on its natural gas component, evidenced by this statement by Clint35, who's looking forward to the day when natural gas stations are on every corner:

It's just a great idea. It's only a matter of time before this business covers the country like McDonalds. Eventually people won't be able to afford gasoline anymore. Then natgas will be a readily available necessity.

Lights out
A-Power Energy Generation Systems (Nasdaq: APWR  ) is also busy building wind farms, but land-based ones in Texas, while American Superconductor is ready to fan growth in China by partnering with Sinovel to erect the most powerful domestically built wind energy system.

But its AMSC's supply of high-voltage power lines to the Tres Amigas projects, a plan to unite this country's three power grids in New Mexico, that could be its biggest source of cash. American Superconductor says the superconducting wires portion of the $1 billion project should generate 30% profit margins alone. That's the project that's attracted CAPS member 1dms, who notes it represents a huge leap forward for renewable energy sources.

With 82% of the 650 CAPS members rating the energy technologies firm indicating they believe it will outperform the market, it wouldn't be a shocking development for you to plug into the American Superconductor CAPS page and leave your own views on it.

A real shoot-'em-up
Expect specialty chemicals maker Huntsman to post rising revenues tomorrow. Despite conflicting signals the economy is giving off over whether its really recovering, rivals Dow Chemical (NYSE: DOW  ) and DuPont (NYSE: DD  ) have both reported solid numbers. There's no reason Huntsman shouldn't, too. But the future's opaque right now, particularly in light of the financial crisis in Greece that risks plunging Europe back into recession.

CAPS member alandefeld isn't worried, saying that despite a ragged global situation, Huntsman has conducted itself well:

Huntsman started out as a special situation based on the failed Hexion acquisition and subsequent lawsuits against erstwhile financial backers. These events, along with the high price of oil pre-recession, severely depressed Mr. Market's view of the company's value. While the value has come up in my estimation, I believe that it is still undervalued, especially given that it appears to be a well-run company which is responding carefully to a recession-torn global chemicals industry.

Yucking it up
The market's rally has changed from being mostly fueled by low-quality stocks to dragging most others along based on lower year-over-year comparables. If you think there's some funny business afoot, let us know -- head over to Motley Fool CAPS and sound off.

Try any of our Foolish newsletter services today, free for 30 days.

Fool contributor Rich Duprey does not have a financial position in any of the stocks mentioned in this article. You can see his holdings here. The Motley Fool has a disclosure policy.


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  • Report this Comment On May 07, 2010, at 1:45 AM, jfoxrun wrote:

    As the Gulf Oil Tragedy worsens, two things occur to me. First is the ineptitude of humans to control outcomes of their mechanical invasions upon Mother Earth. Second is the vulnerability of waters to this destructive folly. In a genuine lack of wisdom, the US has once again decided to go beyond where it should go - this time by Salazar approving Cape Wind. He just slated Nantucket Sound's fragile ecosystem for an electrical service platform with a helicopter pad, fuel, transformer oil, greases, and industrial lubricants - tens of thousands of gallons of them about 4 miles offshore in those waters. With an increase in predicted severe weather events already taking place, prospects of nor'easters on steroids just doesn't bode well for offshore wind farms in their path. Has Mr. Salazar and Minerals Management just made a budgetary decision on how to kill the waters? Why use premium crude oil when tens of thousands of gallons of alternative industrial fluids will work just as well? People, offshore wind farms are not benign pinwheels. They are industrial power plants that can pollute just as much as any man-made beast. Our life-giving waters should not be squandered like this.

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Related Tickers

9/19/2014 1:59 PM
AMSC $1.45 Down -0.03 -2.03%
American Supercond… CAPS Rating: **
CLNE $8.79 Down -0.06 -0.62%
Clean Energy Fuels CAPS Rating: ****
HUN $28.26 Down -0.17 -0.60%
Huntsman Corp CAPS Rating: *****
APWR.DL $0.00 Down +0.00 +0.00%
A-Power Energy Gen… CAPS Rating: ***
DD $71.66 Up +0.46 +0.64%
E.I. du Pont de Ne… CAPS Rating: ****
DOW $53.58 Down -0.01 -0.02%
The Dow Chemical C… CAPS Rating: ****
NRG $31.14 Up +0.34 +1.10%
NRG Energy, Inc. CAPS Rating: ****

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