As earnings season continues, a negative surprise from a company can crush its stock. But how can you tell in advance whether a stock you own is likely to take a hit from an earnings shortfall?
Past performance may not guarantee future results, but companies that haven't been consistent about matching or beating earnings estimates are logical candidates to expect future negative surprises. So I took a look at the 30 stocks in the Dow Jones Industrials
As you might expect from the industry leaders that make up the Dow, most Dow stocks do a good job of hitting estimates. But four stocks had missed estimates at least twice over the four quarters leading up to this earnings season. Let's take a closer look at them.
Keep looking at earnings
As we've seen so far this quarter, just because a company misses on earnings in one quarter doesn't mean it won't beat the next. But one thing's certain: you have to keep your eyes open to see what's happening with your stocks.
That's the thinking behind the Motley Fool's special report on earnings, which identifies five stocks that investors simply have to watch this earnings season. The report is free, so let me invite you to click here and get the scoop today.
Fool contributor Dan Caplinger doesn't own shares of the companies mentioned. You can follow him on Twitter here. Motley Fool newsletter services formerly recommended buying shares of Wal-Mart and still recommend creating a diagonal call position in Wal-Mart. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Fool has a disclosure policy.