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 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 Baidu.com (Nasdaq: BIDU ) . China's leading search engine saw third-quarter profits more than double to $0.70 a share. Analysts were expecting the fast-growing market share leader to boost its profitability to just $0.63 a share.
The bottom line would have clocked in ever chunkier if the company hadn't entered the Japanese search engine market earlier this year. Baidu has now beaten Wall Street's profit targets in five of the past six quarters.
Akamai (Nasdaq: AKAM ) was another topper. The content delivery network giant earned $0.34 a share in non-GAAP earnings this past quarter, just ahead of the market's $0.33 target. Beating by a penny may seem petty, but it's actually not. The sector has been battered in recent months, with investors concerned about the cutthroat ways within the industry that speeds up Internet media delivery. Rival Limelight Networks (Nasdaq: LLNW ) went public back in June and is trading well below its $15 IPO price tag.
After simply meeting expectations in each of this year's first two quarters, it's encouraging to see Akamai step ahead of the Wall Street crowd for a change.
Finally, we had Amazon.com (Nasdaq: AMZN ) reporting. The leading online retailer earned $0.19 a share in its latest quarter, slightly ahead of where the pros were perched. Amazon has now topped forecasts in each of the past five quarters.
Amazon's win also came a week after smaller rival Overstock.com (Nasdaq: OSTK ) sped past analysts. It's hard to bet against the sector with that kind of steam heading into the seasonally spiked holiday shopping quarter.
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.