Don't settle for ordinary quarterly reports.
Every week, I take a look at three companies that beat market expectations, since I believe that it's the biggest factor in a stock beating the market. Leaving Wall Street's pros with stunned expressions can be a good thing. It usually means that the companies have more in the tank than analysts figured. Capital appreciation typically follows.
Let's take a look at a few companies that humbled the pros over the past few trading days.
We can start with Huntington Bancshares (NASDAQ:HBAN). The regional banker's quarterly profit of $0.19 a share was comfortably ahead of the $0.17 a share that analysts were forecasting. The solid report was enough to win the Ohio-based banker an upgrade from the analysts at Compass Point. Despite the concerns for margin compression and other risks with financial services companies these days, Compass Point feels as if the improved outlook for the year ahead makes Huntington shares compelling at this point.
Xilinx (NASDAQ:XLNX) also managed to best the pros. The provider of integrated circuits and other programmable solutions saw its adjusted profitability slip from $0.47 a share to $0.38 a share, but that was actually just ahead of the $0.37 a share that Wall Street was expecting.
It's a familiar place for Xilinx to be. The tech company has managed to beat analyst estimates every single quarter over the past year.
Finally, we have eBay (NASDAQ:EBAY) also extending its streak of market-thumping financial performances. The company behind the namesake online marketplace and PayPal financial transaction platform came through with quarterly net income of $0.70 a share in last week's report.
Things haven't always gone eBay's way, but the dot-com darling has only failed to surpass Wall Street expectations just once since the summer of 2006.
Moving in the right direction
It's important to keep watching the companies that surpass expectations. Over time, it will be a lucrative experience for investors as the market rewards the overachievers. That's the kind of surprise that we look for in the Rule Breakers newsletter service. Want in? Check out a 30-day trial subscription.