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

  • I predicted that LeapFrog would close out the week higher. After dominating the lists of the hottest-selling toys during the holidays, it was easy to expect big things out of the maker of electronic education toys. LeapFrog did come through with a better-than-expected report. Net sales rose 16% and margins widened as operating income climbed 28%. However, the market wasn't wowed by the performance. Shares of LeapFrog inched 3% lower on the week. I was wrong.
  • 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? The Nasdaq closed 0.5% higher, pushed higher by a strong Friday for tech stocks. The Dow, on the other hand, clocked in with a decline of 0.1% on the week. I was right.
  • My final call was for OpenTable to beat Wall Street's quarterly profit target. Despite a perpetually healthy flow of skepticism, the leading online dining reservations specialist continues to tack on new restaurants to its platform. OpenTable has also been consistently beating the prognosticators, and there's little reason to bet against OpenTable until that trend reverses itself. Analysts were looking for a profit of $0.43 a share. OpenTable came through with net income of $0.46. I was right.

Two out of three? I can do better than that.

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.Apple will close out the week higher
Shares of Apple moved 5.3% higher last week as the company responded to calls for the tech giant to dig deeper into its pockets to return more of its money to stakeholders.

The rally has legs. Apple shares had gotten too cheap. Yes, Android is eating Apple's lunch, and margins may get pressured in the future, but valuing Apple based on its existing portfolio of products ignores its ability to innovate. The 2001 iPod, 2007 iPhone, and 2009 iPad show that the company can carve out new markets that didn't exist until Apple appeared.

Apple isn't likely to make any major announcements in the coming days, but investors were too hard on Apple in seeing the stock plummet more than 30% off last year's all-time highs. Apple isn't perfect, but it's a better value than cynics believe. My first call is for Apple to close the week higher.

2.The Nasdaq Composite will beat the Dow this week
Betting on tech over stodgy blue chips was a steady winning bet for me last year. This has been a losing bet lately, but I still think technology is the best sector to be invested in these days.

I'm going to stick with this pick. Most of the names in the composite are just too cheap at this point, and the results this earnings season aren't as bad as some worrywarts feared. 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. Michael Kors will beat Wall Street's earnings estimates
Some stocks are just flat-out better than others.

Michael Kors is the leading retailer of stylish apparel, handbags, and other accessories. It's easy to be skeptical as we head into the Hong Kong-based company's fiscal third-quarter report on Tuesday. Michael Kors' biggest rival saw its shares dive last month after a poorly received quarterly report. However, Michael Kors has been able to post strong growth even as other markets for luxury goods have sputtered lately.

Another thing it does is make analysts look like perpetual underachievers. If analysts say that the company posted a profit of $0.41 a share in its latest quarter, I'll whip out a "greater than" sign. 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.

 Quarter

EPS Estimate

EPS

Surprise

Q3 2012

$0.09

$0.20

122%

Q4 2012

$0.16

$0.22

38%

Q1 2013

$0.20

$0.34

70%

Q2 2013

$0.40

$0.49

23%

Source: Thomson Reuters.

Things can change, of course. Fashion is fickle, and shoppers can head elsewhere for their designer needs. Customers can also grow more cost-conscious, especially as folks come to grips with smaller paychecks in 2013 in light of the payroll-tax stimulus reversal.

However, there are no signs that we're turning our back on the company. 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 Next Week originally appeared on Fool.com.

Longtime Fool contributor Rick Aristotle Munarriz has no position in any stocks mentioned. The Motley Fool recommends Apple, LeapFrog Enterprises, and OpenTable and owns shares of Apple and LeapFrog Enterprises. 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.

Copyright © 1995 - 2013 The Motley Fool, LLC. All rights reserved. The Motley Fool has a disclosure policy.


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