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 over the past few trading days.

We can start with Lennar (NYSE: LEN  ) . No one should be surprised to see the company post a loss in its latest quarter. Homebuilders are in a real bind with falling prices, excess inventory, and a glut of unsold homes in the resale market. However, Lennar posted a loss of just $0.56 a share, roughly half the $1.07 deficit for which analysts were braced.

It actually was an even better report than that, since, as fellow Fool David Lee Smith points out, Lennar suffered only an $0.18-per-share loss before unusual charges. That's pretty amazing, especially when fellow residential developer KB Home (NYSE: KBH  ) posted a loss that was nearly three times larger than the market was expecting a day after Lennar's report.  

Red Hat (NYSE: RHT  ) is another topper. The software maker that is cashing in on the commercialization opportunities behind the open-source Linux earned $0.20 a share excluding one-time charges, just ahead of the $0.19 a share profit target where Wall Street was hanging its hat.

Even though recent forays by Microsoft (Nasdaq: MSFT  ) , Oracle (Nasdaq: ORCL  ) , and Novell (Nasdaq: NOVL  ) to make a mark in this space have stung Red Hat, the company is clearly still growing.

Finally, we have food giant ConAgra (NYSE: CAG  ) earning $0.63 from continuing operations in its fiscal third quarter, well ahead of the $0.41 a share in analyst estimates. The company has gotten over last year's recall of its Peter Pan peanut butter, which could have been both a sticky and chunky situation.

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.

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