Don’t settle for ordinary quarterly reports.
Every week, I take a look 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 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 Deckers Outdoor Corp (NASDAQ:DECK).
The company behind Ugg boots and other stylish yet rugged outdoor footwear saw its shares move 15% higher last week after posting better-than-expected results.
It wasn’t pretty. Revenue only inched 2% higher, and profitability fell 23% to $2.77 a share as rising costs of sheepskin and other materials mauled margins. However, $2.77 a share is actually well ahead of the $2.57 a share that analysts were modeling.
Dendreon Corporation (NASDAQ:DNDN) also came through with solid results. The drugmaker’s deficit of $0.26 a share was less than half the red ink that Wall Street was targeting. This is a welcome development at Dendreon, as it had posted larger losses than analysts were banking on for 10 consecutive quarters until late last year.
Shares of Dendreon didn’t move on the beat, and there’s a good reason for that. Its flagship drug is Provenge, a costly yet compelling treatment for late-stage prostate cancer. Sales were up sequentially — and that’s encouraging — but Dendreon Corporation (NASDAQ:DNDN) warned of softness for the current quarter.
Finally, we have Zagg Inc (NASDAQ:ZAGG). The heavily shorted maker of accessories for tablets and smartphones generated a profit of $0.37 a share after backing out a non-cash impairment charge. Analysts were settling for net income of $0.29 a share.
Net sales had soared 30% at ZAGG, boosted by strong sales of keyboards that attach to tablets. Yes, Zagg Inc (NASDAQ:ZAGG) isn’t just about its invisibleSHIELD protective film covering anymore.
The article 3 Stocks That Blew the Market Away originally appeared on Fool.com and is written by Rick Aristotle Munarriz.
Longtime Fool contributor Rick Aristotle Munarriz has no position in any stocks mentioned. The Motley Fool owns shares of Dendreon.
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