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The following is a list of companies that have recently raised earnings guidance above analyst estimates. Additionally, all of these names have experienced significant insider buying over the last two years.

Analysts seem to be underestimating the earnings potential of these companies, while insiders are getting more bullish on these names - does that mean there's more good news to be priced in? Full details below.

Earnings guidance data sourced from Briefing.com, short float and performance data sourced from Finviz.



1. American Eagle Outfitters, Inc. (NYSE:AEO): Apparel Stores Industry. Market cap of $3.0B. The stock has lost 6.57% over the last year.

Recently guided Q4 at high end of $0.41-0.43 vs. estimate of $0.42. Over the last two years, insiders bought an average of 240,912 shares per year.

The company's capital spending accelerated by 5.54% over the last five years, much faster than the industry average of -8.45%. At least theoretically, this makes them more competitive over the coming years, since their operational assets are more up-to-date.

2. American Water Works Company, Inc. (NYSE:AWK)
: Water Utilities Industry. Market cap of $4.84B. The stock has gained 37.28% over the last year.

Recently guided FY11 at $1.65-1.75 vs. estimate of $1.65. Over the last two years, insiders bought an average of 21,638 shares per year.

The company has demonstrated rapid cash flow growth over the last five years, which may lower their risk going forward. Five year average cash flow growth at 35.3%, much higher than the industry average at 19.98%.

3. First Industrial Realty Trust Inc. (NYSE:FR): REIT. Market cap of $702.75M. The stock is currently exhibiting strong upside momentum--currently trading 8.34% above its SMA20, 27.57% above its SMA50, and 66.06% above its SMA200.

Recently guided FY11 at $0.83-0.93 vs. estimate of $0.81. Over the last two years, insiders bought an average of 912,850 shares per year.

Note that this is a risky stock that is significantly more volatile than the overall market (beta = 2.48). The stock is also a short squeeze candidate, with a short float at 11.11% (equivalent to 5.64 days of average volume).

Other Highlights: Institutional and mutual fund investors have been net purchasers of the company's shares over the last two quarters, suggesting that the smart money thinks there's more upside to the stock. Institutional investors have been net buyers of 6.8M shares during the most recent quarter, vs. 4.1M net shares purchased in the previous quarter. Mutual fund investors have also been optimistic on the stock. They were net buyers of 1.7M shares during the most recent quarter, vs. 494.9K net shares purchased in the previous quarter.

4. Hypercom Corp. (NYSE:HYC): Business Equipment Industry. Market cap of $599.28M. The stock has had a couple of great days, gaining 10.43% over the last week (exhibiting strong upside momentum--currently trading 6.88% above its SMA20, 13.95% above its SMA50, and 71.% above its SMA200)

Recently guided Q4 at $0.18-0.20 vs. estimate of $0.15. Over the last two years, insiders bought an average of 400,089 shares per year, over the last two years.

Other Highlights: The company has demonstrated rapid cash flow growth over the last five years, which may lower their risk going forward. Five year average cash flow growth at 62.47%, much higher than the industry average at 36.95%.

5. KAR Auction Services, Inc. (NYSE:KAR):
Auto Dealerships Industry. Market cap of $1.93B. The stock has gained 0.42% over the last year.

Recently guided FY11 at $1.20-1.25 vs. estimate of $1.07. Over the last two years, insiders bought an average of 820,766 shares per year, over the last two years.

Other Highlights: The company outperformed analyst earnings estimates during the most recent quarter, suggesting that the analyst community is underestimating the stock. The company reported earnings per share of $0.20 per share, and exceeded the First Call Consensus of $0.14 (Q4 earnings on 02/23/11). The company also outperformed analyst estimates over the last year, reporting earnings per share at $1.05, beating the consensus view at $0.99 (based on the estimates of 7 analysts).

Disclosure: I have no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours.

Source: Insider Buying Alerts: 5 Stocks Boosting Guidance