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 pros over the past few trading days.
We can start with Ferrellgas Partners (NYS: FGP) .
It was easy to bet against the propane distributor. Ferrellgas missed Wall Street's profit targets for eight consecutive quarters before Friday morning's report. However, the company came through with a quarterly profit of $0.26 a share. Battered analysts were only holding out for net income of $0.19 a share.
Annie's (NYS: BNNY) recently went public, so there were going to be plenty of eyes on the organic foodstuffs maker in its first quarterly report as a public company. Well, net sales and adjusted earnings climbed nearly 18% higher on both counts.
Annie's profit of $0.24 a share bested the $0.20 a share that Wall Street was forecasting. Investors should have seen this coming. Fellow organic goods distributor Hain Celestial (NAS: HAIN) and leading organic grocer Whole Foods Market (NAS: WFM) had topped pro estimates last month.
Finally we have Francesca's Holdings (NAS: FRAN) dressing up nicely. The fast-growing boutique operator made headlines for all the wrong reasons a quarter ago, when its CFO was let go after tweeting "Good numbers=Happy Board" -- possibly leaking good news -- days ahead of its official quarterly report.
Lips were sealed this time around, but the retailer's quarterly profit of $0.20 a share was comfortably ahead of the $0.18 a share that the market was betting on.
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 this article was published 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 the Rule Breakers newsletter research team, seeking out tomorrow's ultimate growth stocks a day early.The Motley Fool owns shares of Whole Foods Market and The Hain Celestial Group. Motley Fool newsletter services have recommended buying shares of Whole Foods Market and The Hain Celestial Group. The Motley Fool has a disclosure policy. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. Try any of our Foolish newsletter services free for 30 days.
Copyright © 1995 - 2012 The Motley Fool, LLC. All rights reserved. The Motley Fool has a disclosure policy.