3 Stocks That Blew the Market Away

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Don't settle for ordinary quarterly reports.

I take a look at three companies that beat market expectations every week, 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 prognosticators over the past few trading days.

We can start with FedEx (NYS: FDX) . The speedy deliverer posted adjusted earnings of $1.57 a share in its latest quarter, ahead of both the $1.16 a share it rang up a year earlier and the $1.52 a share that investors were banking on.

FuelCell Energy (NAS: FCEL) also fueled past the pros. The power plant maker saw revenue climb 76% in its latest quarter, and it now has a product backlog of $131.8 million. However, for our purposes, FuelCell makes the cut by posting a quarterly deficit of $0.06 a share. Wall Street was braced for a loss of $0.07 a share. It may not seem like much of a beat, but FuelCell Energy has now posted narrower than projected losses in five consecutive quarters.

Speaking of smaller-than-expected losses, drugstore chain Rite Aid (NYS: RAD) posted a deficit of $0.06 a share. Wall Street figured that the beleaguered pharmacy operator would generate nearly twice the red ink that it actually did. Rite Aid also narrowed its projected deficit for the entire year. This may not look pretty, but it's the way that turnarounds start.

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. If that's not up your alley just yet, you can still check out a free special report detailing the next trillion-dollar revolution.

Either way, come back next week to learn about more stocks that blew the market away in the coming days.

If you want to track these stocks to see if they come out ahead next quarter, add them to My Watchlist:

At the time this article was published The Motley Fool owns shares of FedEx. Motley Fool newsletter services have recommended buying shares of FedEx. 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 Motley Fool has a disclosure policy.Longtime Fool contributor Rick Munarriz calls them as he sees them. He does not own shares in any of the stocks in this story. Rick is also part of theRule Breakersnewsletter research team, seeking out tomorrow's ultimate growth stocks a day early.

Copyright © 1995 - 2011 The Motley Fool, LLC. All rights reserved. The Motley Fool has a disclosure policy.

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