By
Rick Aristotle Munarriz
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More Articles
January 12, 2009
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Why settle for ordinary quarterly reports? Every week, I look at three companies that have surpassed market expectations. Leaving Wall Street's pros with quizzical looks usually means that the companies have more in the tank than analysts figured, and capital appreciation often follows.
So let's examine a few companies that humbled the prognosticators over the past few trading days.
We can start with Apollo Group (Nasdaq: APOL ) . The for-profit educator posted a quarterly profit of $1.12 a share, well ahead of both the $0.83 it earned a year ago and the $0.98 that analysts were expecting.
Post-secondary schooling remains a growth industry. It's gaining urgency in these recessionary times as displaced employees try to brush up on skills for a retooled workforce. That's why rivals such as DeVry (NYSE: DV ) and Corinthian Colleges (Nasdaq: COCO ) were some of last year's few gainers and Grand Canyon Education (Nasdaq: LOPE ) was last year's best-performing IPO.
WD-40 (Nasdaq: WDFC ) is another topper. The company behind the namesake multipurpose solvent rang up net income of $0.46 a share in its fiscal first quarter, 23% higher than the previous year's showing. Wall Street can probably use a squirt or two of the famous spray to overcome its creakiness, since the pros were looking only for earnings of $0.41 a share.
Finally, we have Bed Bath & Beyond (Nasdaq: BBBY ) checking in. The home-goods retailer saw its quarterly profit shrink to $0.34 a share, but that still beat analyst guesstimates of $0.33. We expect value-minded retailers such as Family Dollar (NYSE: FDO ) to beat the Street -- and Family Dollar did -- but I find it more extraordinary when a company moving hand towels and shower curtains scores a relative victory.
So keep watching the companies that beat 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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