3 Predictions for the New Week

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

I predicted that Model N (NYSE: MODN  ) would post a smaller loss than analysts were expecting. The provider of revenue management solutions has been a dud since going public nearly a year ago, but one thing it has consistently done is post a smaller deficit than what the pros are forecasting. Wall Street was settling for a loss of $0.12 a share, and Model N sported only $0.03 a share in red ink. The stock soared 19% on Tuesday after the better-than-expected report. I was right. After more than a year of predicting that the tech-heavy Nasdaq would outperform the Dow Jones Industrial Average   (DJINDICES: ^DJI  ) , I mixed things up two weeks ago. I simply predicted that the Dow would bounce back after plunging 3.5% and 1.1% over the prior two weeks. I repeated the call this time around, and the Dow responded with a hearty 2.3% gain. I was right.  My final call was for LeapFrog (NYSE: LF  ) to beat Wall Street's income estimates in its latest quarter. The maker of electronic learning toys has been routinely beating Wall Street projections over the past year. I was banking on a repeat performance, but it wasn't to be. LeapFrog merely broke even on a sharper drop in revenue than expected. Analysts had been braced for a profit of $0.14 a share. I was wrong.

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. Veeco Industries will post a larger loss than analysts are expecting
Veeco Industries (NASDAQ: VECO  ) is a provider of process equipment solutions that assist the making of LEDs, flexible OLEDs, power electronics, hard drives, MEMS, and wireless chips. Unfortunately for investors it also has been posting a lot of red ink lately.

The one constant over the past year is that Veeco has posted a larger deficit than analysts were forecasting, and that goes for the two periods over the past when the pros were holding out for a profit.

Analysts see Veeco posting a loss of $0.33 a share on Wednesday. That's a lot, but my first call remains that it will wind up with a larger deficit than that.

2.The Dow will close lower this week
The market in general has given us two healthy weeks of gains, so I'm going to switch gears on my call that the Dow Jones Industrial Average inches higher again. It will be a holiday-shortened trading week, given that the exchanges will be closed on Monday, and I can see the blue chips taking a breather after two strong weeks.

My second call is for the Dow Jones Industrial Average to close lower on the week.

3. LifeLock will beat Wall Street's earnings estimates
Some stocks are just flat-out better than others.

LifeLock (NYSE: LOCK  ) is the leading provider of identity theft monitoring for consumers. This may seem like a finicky model for a subscription service, but LifeLock has come through with 34 consecutive quarters of sequential growth in revenue and members.

Another thing it does is make analysts look like perpetual underachievers. If analysts say the company posted a profit of $0.21 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

Q4 2012	$0.07	$0.10	43%
Q1 2013	($0.01)	$0.01	200%
Q2 2013	$0.01	$0.03	200%
Q3 2013	$0.10	$0.12	20%

Source: Thomson Reuters.

Things can change, of course. Despite all of the buzz being generated about identity protection breaches at a couple of major retailers this holiday shopping season, LifeLock is not a lock to stretch that streak to 35 quarters of sequential growth. Members can flock to cheaper offerings or leave entirely.

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 as you check out some more stock picks.

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