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 AeroVironment (NAS: AVAV) flying past the pros undetected. The maker of unmanned aircraft systems posted a fiscal second quarter profit of $0.30 a share, a 30-fold gain from the mere $0.01 a share that it posted a year earlier. More importantly for our purposes, analysts were only banking on net income of $0.20 a share.
I guess it pays to make military products that keep human lives out of harm's way, since PackBot maker iRobot (NAS: IRBT) has been consistently landing ahead of Wall Street's projections for two years.
Titan Machinery (NAS: TITN) also harvested a bountiful quarter. The farm equipment retailer planted a quarterly profit of $0.61 a share, well ahead of the $0.50 a share that the pros were expecting. Titan also raised its guidance. Rising food prices translate into farmers investing more in their agricultural pursuits.
Finally, we have Vera Bradley (NYS: VRA) on the move. The maker of fashionable handbags, suitcases, and accessories rang up a profit of $0.32 a share. Analysts were only targeting net income of $0.28 a share. Since going public 14 months ago, Vera Bradley is 4-for-4 in beating Wall Street estimates on the bottom line. Happy travels!
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:
At the time thisarticle was published Motley Fool newsletter services have recommended buying shares of iRobot and AeroVironment. 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.
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