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Don't settle for ordinary quarterly reports.
Every week I take a look at three companies that beat market expectations, since I believe that it's the biggest factor in a stock beating the market. Leaving Wall Street's pros with stunned expressions can be a good thing. It usually means that the companies have more in the tank than analysts figured. Capital appreciation typically follows.
Let's take a look at a few companies that humbled the pros over the past few trading days.
Things aren't perfect at SUPERVALU. Sales and comparable-store sales both slipped during the period. It still posted a loss for the entire fiscal year. Cheap-chic department store chain Target (NYSE: TGT ) is moving away from SUPERVALU as its grocer and toward a self-distribution model. However, an encouraging outlook and the stock's cheap valuation was enough to send the shares 25% higher last week.
Mattress Firm (Nasdaq: MFRM ) was also a form-fitting winner. The bedding retailer with arguably the best name among publicly traded companies scored a profit of $0.56 a share, roughly tripling the $0.19 a share that Wall Street was resting on. Upbeat guidance and a market-widening acquisition should continue to give shareholders pleasant dreams.
JPMorgan Chase (NYSE: JPM ) kicked off the earnings season for the wave of banking giants that will be reporting in the coming days with its report on Friday. The financial services giant posted a profit of $1.31 a share, easily besting the $1.18 a share that the pros were -- wait for it -- banking on.
Moving in the right direction
It's important to keep watching the companies that surpass expectations. Over time, it will be a lucrative experience for investors as the market rewards the overachievers. That's the kind of surprise that we look for in the Rule Breakers newsletter service. Want in? Check out a 30-day trial subscription. If that's not up your alley just yet, you can still check out a free special report detailing the next trillion-dollar revolution.
Either way, come back next week to learn about more stocks that blew the market away in the coming days.