The current earnings season is in full swing, and for the most part it has been a pretty good season. We have certainly see a few big names post disappointing results, but the general trend has been positive, and in some cases the results have far exceeded analyst forecasts, which in turn drove some already hot stocks even higher, and helped some weaker stocks regain their footing.
On the surface, it is easy to believe that all a company has to do is post better than expected earnings for the stock to move higher, but that is not really the case. Wall Street loves to see growth, expected growth, or at the very least improvement from a weaker company.
If a company is able to post stronger than expected results, with the expectation of additional growth moving forward, Wall Street will rally behind the stock and drive shares higher. We have already seen that with a couple of this year’s hottest stocks, and there will certainly be more instances of such moves as we advance deeper into the earnings season.
Let’s take a look at five stocks that recently posted stronger than expected results, and examine whether or not it is still a good time to buy shares, and where Wall Street believes the stocks should be trading.