Sodastream International Ltd (SODA), Multimedia Games Holding Company Inc (MGAM): Three Predictions for the New Week

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Yes, earnings reports have been rough in some places this season, but the long-term outlook is still quite favorable. 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. Multimedia Games will beat Wall Street’s earnings estimates
Some stocks are just flat-out better than others.

Multimedia Games Holding Company Inc (NASDAQ:MGAM) is a provider of casino games, growing at a healthier rate than its larger rivals. Another thing it does is make analysts look like perpetual underachievers. If analysts say that the company posted a profit of $0.24 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.

Quarter EPS Estimate EPS Surprise
Q3 2012 $0.25 $0.39 39%
Q4 2012 $0.21 $0.30 43%
Q1 2013 $0.13 $0.24 85%
Q2 2013 $0.19 $0.31 63%

Source: Thomson Reuters.

Things can change, of course. The revenue-sharing arrangement with one of its largest partners recently turned against Multimedia Games Holding Company Inc (NASDAQ:MGAM)’ favor, and gambling as an addiction is being seen as a bigger problem than before.

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.

The article 3 Predictions for the New Week originally appeared on Fool.com and is written by Rick Munarriz.

Longtime Fool contributor Rick Munarriz owns shares of SodaStream. The Motley Fool recommends Apple and SodaStream and owns shares of Apple, Multimedia Games, and SodaStream.

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