3 Predictions for the New Week

3 Predictions for the New Week

I went out on a limb last week, and now it's time to see how that decision played out.

  • I predicted that Tesla Motors would close lower on the week. The maker of plug-in electric cars has seen its shares pop fivefold, far outpacing the growth in new orders for its Model S sedan. I remain long-term bullish on Tesla but felt that it was due for a breather. Despite an otherwise strong week for tech stocks, Tesla's stock did close 1.2% lower on the week. I was right.

  • I predicted that the tech-heavy Nasdaq would outperform the Dow Jones Industrial Average. . This has been a tricky call lately, so how did it play out this time? Well, this was a great week for tech stocks. The Nasdaq moved nearly 2% higher, and that was better than the Dow's 0.8% ascent. I was right.

  • My final call was for Bazaarvoice to beat Wall Street's income estimates in its latest quarter. The provider of social commerce solutions has been losing money since going public, but it's been consistently posting less red ink than the pros were projecting over the past year. I was banking on seeing the trend continue. Analysts were looking for a loss of $0.08 a share during the quarter, and it came through with an adjusted deficit of $0.05. The stock fell on Bazaarvoice's disappointing outlook, but it was still a beat looking back. I was right.

Three out of three? I'll take it!

Let me once again whip out my trusty, dusty, and occasionally accurate crystal ball to make three calls that may play out over the next few trading days.

1. Green Mountain Coffee Roasters will close higher on the week
The new iPhone is going to be getting all of the hoopla on Tuesday, but it's not the only company looking to impress the market that day. Green Mountain Coffee Roasters will be hosting its first ever Investors Day, aiming to show how far Keurig has come -- and how far it can go in the future.

Yes, Green Mountain's had an amazing run lately. The stock has more than tripled over the past year. However, there are still plenty of skeptics who could use some convincing that Green Mountain isn't hogtied to the fate of last year's expiration of its K-Cup patents. The single-serve coffee specialist has a good story to tell, and it will get a chance on Tuesday.

My first call is for this Green Mountain to close higher on the week.

2.The Nasdaq Composite will beat the Dow this week
Tech has been a big winner in recent years, so betting on tech over stodgy blue chips has been a good bet for me more often than not.

I'm going to stick with this pick. Most of the names in the composite are just too cheap at this point, and tech should be what carries us through the economic recovery. The market is ripe for the tech-stacked secondary stocks to continue to outpace the 30 megacaps that make up the Dow Jones Industrial Average.

3. Lululemon will beat Wall Street's earnings estimates
Some stocks are just flat out better than others.

lululemon athletica is a fast-growing retailer of high-end yoga apparel for women, but you don't need a yoga mat to dig Lululemon's stylish workout clothing. Comps have been on a tear over the years, and the chain can't seem to expand its concept quickly enough to satisfy the growing demand for its wares.

Another thing it does is make analysts look like perpetual underachievers. If analysts say the company posted a profit of $0.35 a share in its latest quarter, I'll argue that it held up better than that. History's on my side!

One of my best tricks to beating the market is finding stocks that perpetually land ahead of the prognosticators. Let's go over the past year of earnings reports.


EPS Estimate



Q2 2012




Q3 2012




Q4 2012




Q1 2013




Source: Thomson Reuters.

Things can change, of course. The company made headlines when it had to recall a popular exclusive line of yoga pants because of their sheerness. Its longtime CEO also recently stepped down. You have a company that has felt pretty mortal lately by only narrowly beating Wall Street forecasts. It used to fly past the pros with ease as recently as last year.

However, it's hard to argue against the trend. Everything seems to be falling into place for another market-thumping quarter on the bottom line.

Three for the road
Well, there are three predictions right there. Let's see how I fare this week.

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The article 3 Predictions for the New Week originally appeared on Fool.com.

Longtime Fool contributor Rick Munarriz owns shares of Green Mountain Coffee Roasters. The Motley Fool recommends Green Mountain Coffee Roasters, lululemon athletica, and Tesla Motors and owns shares of Tesla Motors. Try any of our Foolish newsletter services free for 30 days. We Fools don't 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.

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