By
Rick Aristotle Munarriz
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More Articles
September 8, 2009
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Why settle for ordinary quarterly reports?
I believe that the biggest factor in a stock's ability to beat the market is to beat the market's expectations. That's why I look every week at three companies that have humbled Wall Street's pros over the past few trading days. If a company has more in the tank than the analysts figured, capital appreciation often follows.
We can start with Jackson Hewitt Tax Services (NYSE: JTX ) . The country's second-largest tax specialist posted a loss of $0.67 a share, narrower than the $0.71 deficit that analysts were banking on. Delivering less red ink than expected during a seasonally forgettable time for tax-prep companies may not seem like much of a feat, but market leader H&R Block (NYSE: HRB ) actually posted a wider loss than Wall Street was targeting a day later.
Jos. A. Bank Clothiers (Nasdaq: JOSB ) hit a 52-week high after the dressy-duds retailer saw quarterly profits soar by 41% to $0.68 a share. Underdressed pros were settling for net income of only $0.54 a share.
Shanda Interactive (Nasdaq: SNDA ) is growing nicely as China's pioneer of online gaming. Earnings rocketed by 53% to $0.90 a share, comfortably ahead of the Wall Street's profit projections of $0.84.
Investors probably saw Shanda's victory dance coming, since smaller peers Perfect World (Nasdaq: PWRD ) and Changyou.com (Nasdaq: CYOU ) also exceeded expectations last month.
So keep watching the companies that surpass expectations. Over time, doing so 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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