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 this past week.
We can start with Take-Two Interactive (Nasdaq: TTWO ) . Strong sales of Red Dead Redemption helped the edgy video game publisher post a fiscal third-quarter profit of $0.28 a share on an adjusted basis. The pros were braced for a loss.
Take-Two's stock took off on Friday after the report, which also found the developer dramatically raising its near-term guidance. The past year and change may have been rough for the industry, but you wouldn't know it going solely by the income statements. Take-Two's largest rivals -- Electronic Arts (Nasdaq: ERTS ) and Activision Blizzard (Nasdaq: ATVI ) -- also landed ahead of Wall Street's earnings estimates.
Solar power specialist Energy Conversion Devices (Nasdaq: ENER ) is also shining brighter, if only relatively speaking. Yes, it did post a quarterly loss of $0.48 a share. Yes, margins will have to improve. Still, analysts were targeting $0.60 a share in red ink, and a beat is a beat.
Finally we have Finisar (Nasdaq: FNSR ) coming out on top. The optical networking posted an adjusted profit of $0.31 a share, blowing past the $0.03 a share it earned a year ago and the $0.23 a share that Wall Street was banking on. Back out Finisar's discontinued operations, and revenue soared 61%.
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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