What happened

Weight Watchers (NASDAQ:WW) stock trailed the market last month by shedding 11% compared to a 3.6% increase in the S&P 500, according to data provided by S&P Global Market Intelligence.

The drop only removed a small portion of investors' market-beating returns so far this year, and the stock has still more than doubled so far in 2018.

^SPX Chart

^SPX data by YCharts

So what

Investors were apparently reacting to that sharp rally in sending the stock lower in July. The increase, after all, raises the bar for Weight Watchers' second-quarter earnings report, which is due out after the market closes on Monday, Aug. 6.

Now what

Investors are expecting to see good things in that earnings announcement after Weight Watchers' management lifted its full-year earnings outlook to between $3 and $3.20 per share (from a prior range of $2.40 to $2.70) in early May. That first quarter included strong subscriber growth, rising engagement, and surging profitability.

A person's feet are on a scale with a tape measure on the ground in front of it.

Image source: Getty Images.

CEO Mindy Grossman and her team will update shareholders on each of these metrics in the upcoming second-quarter report. But, while high expectations might keep a lid on short-term stock gains, Weight Watchers' should continue to beat the market if it maintains the positive momentum investors have seen over the last few quarters.