Setting up targets and mowing them down isn't just a rewarding game at a shooting gallery. It's an approach that works pretty well with Mr. Market, too. Companies that topple profit projections are usually on to something -- and the pros don't know it just yet. Underestimated companies often wind up producing even more upside surprises in the future.
That said, let's take a closer look at a few of the companies that humbled the prognosticators this past week.
We'll start with Yum! Brands
It didn't work out that way. Occupancy was up 1% throughout the company's properties. More importantly, it was granted enough pricing flexibility to inch rates higher. As a result, the typical overnight guest is paying 8% more than this time a year ago. It's a favorable trend that should carry over to Marriott's peers, including InterContinental
Helping Marriott's cause is its aggressive share buyback program. So far this fiscal year, the company has repurchased 20 million shares. Dividing net profits by fewer shares will work wonders to improve the bottom line.
So keep watching the companies that lap expectations. Over time, it will be a rewarding experience for investors. That's the kind of surprise that market watchers relish in the Rule Breakers newsletter service. The strategy has paid off -- the average Rule Breakers selection has more than tripled the S&P 500's market return. 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.
Longtime Fool contributor Rick Munarriz is a fan of toppers, but he does not own shares in any of the companies mentioned in this story. The Fool has a disclosure policy. He is also part of the Rule Breakers newsletter research team, seeking out tomorrow's ultimate growth stocks a day early.