Don't settle for ordinary quarterly reports.
I take a look every week 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 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 pros over the past few trading days, starting with SodaStream International (NAS: SODA) .
The Israeli company behind the popular home-based beverage system that turns flat water into carbonated soft drinks popped higher after posting strong quarterly results.
Revenue climbed 50% and strong sales of the company's higher margin carbonator refills and soda flavors helped boost margins. Adjusted earnings climbed 67% to $11.5 million -- or $0.55 a share. Analysts were only expecting $0.45 a share on the bottom line.
SodaStream's stock moved sharply higher on the news, especially since the shares had tumbled a week earlier after Green Mountain Coffee Roasters posted disappointing quarterly financials. The connection between home-brewed Keurig coffee drinks and liters of cold flavored soda was iffy at best, but SodaStream earned the disconnect.
Affymax (NAS: AFFY) also topped Wall Street. The upstart biotech came through with a rare profitable quarter, earning $0.87 a share on the strength of milestones earned during the period from Affymax's partner on its Omontys Injection compound. The pros were holding out for net income of only $0.49 a share.
Finally we have Jamba (NAS: JMBA) blending better numbers. The leading smoothie chain posted a loss of $0.03 a share during the seasonally slow first quarter. Analysts figured that Jamba would lose twice as much after posting a deficit of $0.11 a share a year earlier.
Moving in the right direction
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.
At the time thisarticle was published The Motley Fool owns shares of SodaStream International.Motley Fool newsletter serviceshave recommended buying shares of Green Mountain Coffee Roasters and SodaStream International.Motley Fool newsletter serviceshave recommended creating a lurking gator position in Green Mountain Coffee Roasters. The Motley Fool has adisclosure policy. We Fools may not all hold the same opinions, but we all believe thatconsidering a diverse range of insightsmakes us better investors. Try any of our Foolish newsletter servicesfree for 30 days.Longtime Fool contributor Rick Munarriz calls them as he sees them. He does not own shares in any of the stocks in this story, except for Jamba and Green Mountain. Rick is also part of theRule Breakersnewsletter research team, seeking out tomorrow's ultimate growth stocks a day early.
Copyright © 1995 - 2012 The Motley Fool, LLC. All rights reserved. The Motley Fool has a disclosure policy.