By
Rick Aristotle Munarriz
|
More Articles
June 21, 2010
|
Don't settle for ordinary quarterly reports.
I believe that the biggest factor in a stock's ability to beat the market is its ability 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 FedEx (NYSE: FDX ) . The overnighter posted a profit of $1.33 a share in its fiscal fourth quarter. That was just a hair above the $1.32 that Wall Street was banking on, but it still means that FedEx has now landed ahead of the pros in three consecutive periods. CEO Fred Smith also issued an upbeat outlook of beefier margins based on global economic improvements.
The dramatic turnaround at Pier 1 Imports (NYSE: PIR ) continues. The home-furnishings retailer earned $0.07 a share in a seasonally sleepy quarter. Mr. Market was targeting a small loss. It's hard to believe that Pier 1's stock traded for as low as $0.10 a share 15 months ago. The stock closed out last week priced at $7.78.
It's been a good time to sell housewares. Bed Bath & Beyond (Nasdaq: BBBY ) and Williams-Sonoma (NYSE: WSM ) have also clocked in ahead of analyst projections throughout the past year.
Finally, we have SMART Modular (Nasdaq: SMOD ) beating the street. The memory-modules specialist posted an adjusted profit of $0.26 a share, as revenue more than doubled. Investors were looking for a showing of $0.18.
It's important to 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.
RSS Headlines
Fool UK