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 prognosticators over the past few trading days.
We can start with Spreadtrum Communications (NAS: SPRD) . The leading maker of smartphone radio chips for the wireless standard championed by Chinese market leader China Mobile (NYS: CHL) posted blowout quarterly results last week. Spreadtrum's earnings of $0.75 a share -- or an adjusted profit of $0.83 a share -- blew past the $0.68 a share that analysts were expecting.
Graphics chip pioneer NVIDIA (NAS: NVDA) is also a speedster these days, benefiting from booming growth in mobile and steady demand on the PC front. NVIDIA's latest quarter featured adjusted earnings soaring 75% to $0.35 a share. Its reported income more than doubled to $178.3 million -- or $0.29 a share. Wall Street was targeting earnings of only $0.26 a share.
Finally, we have Limelight Networks (NAS: LLNW) in the limelight. The content-delivery network delivered a quarterly loss of $0.02 a share, but it was actually much smaller than the $0.06-a-share deficit that analysts were projecting. Market leader Akamai (NAS: AKAM) had also posted market-thumping results for the same quarter, though Level 3 Communications (NAS: LVLT) did fall short.
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.
Either way, come back next Monday to learn about more stocks that blew the market away.
If you want to track these stocks to see if they come out ahead next quarter, add them to My Watchlist:
AddSpreadtrum Communicationsto My Watchlist.
AddNVIDIAto My Watchlist.
AddLimelight Networksto My Watchlist.
At the time thisarticle was published The Motley Fool owns shares of China Mobile.Motley Fool newsletter serviceshave recommended buying shares of NVIDIA and China Mobile.Motley Fool newsletter serviceshave recommended writing puts in NVIDIA. 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 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.
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