3 Stocks That Blew the Market Away

Every week, I take a look at a few companies that lapped their profit targets. Leaving Wall Street's pros with quizzical looks on their faces can be a good thing. It usually means that the companies have more in the tank than analysts figured, and capital appreciation often follows.

Let's take a look at a few companies that humbled the prognosticators this past week.

We can start with Napster (Nasdaq: NAPS  ) . The music subscription service posted positive cash flow for the first time ever in its latest quarter. It did post a loss of $0.10 a share for the fiscal first quarter of 2008, but that was considerably better than the $0.15-per-share deficit the pros were expecting.

Napster still hasn't silenced skeptics. Shares are trading for less than half of the cash on its balance sheet. Subscription services like Napster and RealNetworks' (Nasdaq: RNWK  ) Rhapsody haven't caught on as quickly as piecemeal purchases on iTunes, but that's OK. Now that Napster isn't burning through its greenbacks, it has time on its side.

Chipotle Mexican Grill (NYSE: CMG  ) (NYSE: CMG-B  ) is another topper. The company's second-quarter profit of $0.60 per share is almost as big as some of the chain's signature burritos. It was good enough to chomp past Wall Street's target of $0.45 per share. Investors shouldn't be surprised, though. Chipotle has topped profit projections in each of its first seven quarters as a public company.

Finally, we have Disney (NYSE: DIS  ) . The family-entertainment giant is also working on a streak of seven consecutive blowout quarters. The company's latest report finds the Mouse House growing its fiscal third-quarter earnings from continuing operations by 18%, to hit $0.58 per share. The pros were left holding their mouseketeer ears at the $0.55-a-share mark. Big flicks, busy parks, and hot music stars helped propel the company to higher ground.  

So keep watching the companies that lap expectations. Over time, it will be a rewarding experience for investors, as the market rewards the overachievers. That's the kind of surprise we look for in the Rule Breakers newsletter service. Want in? Check out a 30-day trial subscription.

Either way, come back next Monday to learn about more stocks that blew the market away.

Disney is a Motley Fool Stock Advisor newsletter selection. Chipotle is a Rule Breakers recommendation, while its B-shares are a Hidden Gems pick. Either newsletter can be yours for the next 30 days with a free trial subscription offer.

Longtime Fool contributor Rick Munarriz is a fan of toppers. He does not own shares in any of the companies in this story, save for Disney. He is also part of the Rule Breakers newsletter research team, seeking out tomorrow's ultimate growth stocks a day early. The Fool's disclosure policy always exceeds expectations.