5 Stocks That Are Only Getting Better

Some gains -- and losses -- aren't justified.

Let's try Casey's General Stores (NAS: CASY) on for size.

The convenience-store operator hit a new 52-week high last week. Congrats to the longs, but is Casey's really at the top of its game? Are convenient stores really so convenient for anything more than a wee-hour Icee or six-pack craving?

Analysts see Casey's earning $3.55 a share next year. Three months ago they were targeting a profit of $3.61 a share. Is this the way projections should be heading for a stock hitting fresh highs?

Check the estimates on the stocks in your portfolio. How many of them are going the wrong way? It's happening an awful lot lately.

Pop go these weasels
Thankfully, there are exceptions to the markdown rule. There are several companies for which analysts have actually been increasing their projections over the past few problematic months.

Let's take a look at five companies that are bucking the malaise.


2012 EPS

90 Days Ago

2012 EPS


51job (NAS: JOBS)



Intuitive Surgical (NAS: ISRG)



Coinstar (NAS: CSTR)



Amylin Pharmaceuticals (NAS: AMLN)



Elan (NYS: ELN)



Source: Yahoo! Finance.

Let's start at the top with 51job, a popular online and offline employment recruiter in China. Forget the 27% top-line spurt in its most recent quarter. The growth stock's performance is being sandbagged by a deliberate decision to move away from its old-school print business. It's putting out fewer of its 51job Weekly inserts in city newspapers with local job listings. Its online work recruiting site -- now making up more than half of 51job's revenue -- soared 49% during the quarter.

Now it's true that China's watchful government is getting concerned about certain liberties being afforded in cyberspace. These are risks that investors buying into social networking sites and online gaming outfits need to consider. However, it's highly unlikely that the government is going to meddle with a job creator that makes it easy for employers to fill productive openings.

Intuitive Surgical is the company behind the da Vinci robotic arm that is "lending a hand" to surgeons in specialized procedures.

An easy way to keep analysts revising their targets higher is to expose them as low-balling stiffs. Intuitive Surgical has routinely thumped the prognosticators, failing to beat Wall Street's quarterly bottom-line estimates just twice over the past six years.

Coinstar gets its name from its kiosks that exchange pocket change for store vouchers, but it's really Redbox that's fueling Coinstar's growth these days. Few companies are enjoying Netflix's (NAS: NFLX) missteps as much as Coinstar. Last night's Netflix report confirms that subscribers on dual plans are choosing one plan over the other since the summertime rate hike. Folks that are sticking to streaming will need their DVD and Blu-ray rentals from somewhere, and Redbox fits the bill.

Amylin and Elan are entirely different drug companies. Elan is profitable, Amylin is not. Elan is more mature, while Amylin is still early in its life cycle. However, analysts have found it fit to juice up next year's outlook for both companies -- even if it means targeting a smaller deficit for Amylin.

2012, don't be late
Ben Graham once said that the market is a voting machine in the short run, but a weighing machine in the long run. In other words, the fundamentals will eventually win out over near-term fluctuations. With all five of these companies in better shape than they were three months ago, there's a golden opportunity to game the unfair voting machine.

These five companies are better than they used to be. These five stocks will follow.

If you want to track these five stocks, consider adding them to the MyWatchlist feature.

At the time thisarticle was published Motley Fool newsletter serviceshave recommended buying shares of Elan, Intuitive Surgical, 51job, and Netflix. Try any of our Foolish newsletter servicesfree for 30 days. We Fools may not all hold the same opinions, but we all believe thatconsidering a diverse range of insightsmakes us better investors. The Motley Fool has adisclosure policy.Longtime Fool contributorRick Munarrizcalls them as he sees them. He does not own shares in any of the stocks in this story, except for Netflix. Rick is also part of theRule Breakersnewsletter research team, seeking out tomorrow's ultimate growth stocks a day early.

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