3 Stocks That Blew the Market Away

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Every week, I take a look at a few companies that surpassed 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 Discover Financial Services (NYSE: DFS). The credit card company posted a profit of $0.52 a share, excluding favorable antitrust settlements coming from rivals Visa (NYSE: V) and MasterCard (NYSE: MA). The report is huge, since the company behind the Discover card earned just $0.37 a share during last year's quarter, and analysts were actually expecting a small deficit this time around.

Palm (Nasdaq: PALM) also beat the pros. The handheld pioneer posted a loss of $0.10 a share, well ahead of the $0.24 a share that Mr. Market was targeting. Investors were still concerned about the surprisingly weak number of Pre shipments, but the company's new smartphone is still in its infancy.

Finally, we have Herman Miller (Nasdaq: MLHR) working out. The office furniture specialist that has introduced both the cubicle and the Aeron chair earned $0.22 a share in its latest quarter. This may be roughly a third of the $0.60 a share it earned during the same quarter last year, but analysts were braced for a profit of $0.19 a share. This bodes well for rival Steelcase (NYSE: SCS), which reports later this week.

So, keep watching the companies that top 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.