In 2000, General Electric posted its 100th consecutive quarter of growth in continuing operations. That's 25 years. Raise your hand if that sounds just a bit suspicious. Whatever business you're in, that feat just isn't possible unless your company's managing its reported earnings.

According to a 1998 survey, 78% of chief financial officers attending a given conference said they'd been asked to "cast financial results in a better light" without running afoul of GAAP. Half said they'd done it. Nearly half said they'd been asked to misrepresent their company's numbers, and 38% admitted they'd done so. Another survey at a different conference found that more than half of the CFOs attending had been asked to juice their numbers, and 17% had agreed to do so.

It's easy to understand why companies succumb to the incredible pressure to make it look like they've met or beaten targets or Wall Street expectations. Consistent growth is a feather in any CEO's cap, and a rising stock price often increases many executives' compensation, especially from stock options. But when companies stray from merely managing their numbers within GAAP into outright fudging them -- Enron, Sunbeam, we're looking at you here -- they can ruin themselves and their shareholders.

How can we spot suspicious earnings patterns soon enough to save ourselves? We can track how closely a company meets earnings expectations, monitor its frequency of year-over-year growth, and compare those stats to numbers from a few competitors, which should be affected similarly by changes in the business cycle. Any company that lands eerily close to earnings-per-share (EPS) expectations, and grows earnings year over year with unusual reliability, should raise a yellow flag and invite us to look closer.

Here's a look at what Stryker (NYSE: SYK), the medical device company, has done over the past few years. I've also included a couple of other businesses playing in the same space for comparison.

Company

Reported EPS Within $0.02 of Estimates?

How Close to Estimates, on Average

How Often It Reported Growth

Stryker

25 times in last 26 quarters.

$0.00

21 times in last 22 quarters.

St. Jude Medical (NYSE: STJ)

20 times in last 26 quarters.

$0.02

19 times in last 22 quarters.

Zimmer Holdings (NYSE: ZMH)

11 times in last 26 quarters.

$0.03

18 times in last 22 quarters.

Source: Earnings.com and author's calculation. Difference in number of quarters counted because of data source.

Wow. Stryker has hit within $0.02 of estimates in every single quarter but one for the past six and a half years. And that one time, it beat by $0.03 instead. In fact, in the course of those 25 quarters, it either hit right on or beat by a penny an amazing 21 times. Plus, it reported yearly growth in all but one of the past 4.5 years. That one quarter was the second quarter of 2009, where it reported merely flat earnings. Not once did it report a decline in earnings -- this during both a bull market and a brutal recession.

That's quite an accomplishment. It could be a fantastic company, but if I held shares, I'd definitely be doing some digging to see how it managed that extraordinary record. Mind you, St. Jude is almost as impressive, but Zimmer, in the same line of business as the other two, didn't come anywhere close. Definite yellow flags here, Fools, requiring additional investigation.

Note that I'm not concentrating on managing estimates here -- though management does that, too. However, if a management team always seems to deliver on estimates time and time again, you should probably dig a bit deeper, to see whether its interpretation of GAAP is getting a bit too fast and loose.

Investors crave consistency. That's one reason why its string of reliable results spurred GE's stock price to rise so much in the 1980s and 1990s. But the real world isn't consistent, and Foolish investors should account for that. If a company's results seem too steady to be true, Fools should proceed with caution.

Stryker is a Motley Fool Inside Value pick. Try any of our Foolish newsletter services free for 30 days.

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Fool analyst Jim Mueller is a beneficial owner of General Electric, but doesn't have a position in any other company mentioned. He works with the Stock Advisor newsletter service. The Fool is all about investors writing for investors.