Although we don't believe in timing the market or panicking over market movements, we do like to keep an eye on big changes -- just in case they're material to our investing thesis.

What: Shares of supply chain optimization specialist Manhattan Associates (NAS: MANH) rallied 10.5% after the company reported better-than-expected first-quarter results.

So what: Manhattan Associates reported a quarterly profit of $0.60 on a 28% rise in sales to $91.5 million. License revenue was the big surprise, as revenue doubled to $15.6 million from $7.8 million in the year-ago period. The results beat Wall Street estimates on both EPS and revenue. Even more impressive, the company boosted its growth forecasts. It now expects revenue to grow by 11%-14% versus its original prediction of 10%-12%, and expects adjusted EPS to jump 10%-12% versus a previous expectation of 8%-10%. These figures are more or less in line with Wall Street estimates.


Now what: After years of stagnant sales, it's encouraging to see Manhattan's margins rising and license revenue soaring. However, I'm still not certain I'd consider the company a great value here at 18 times forward earnings and 19 times cash flow following so many years of tepid growth. Give me a few more quarters of outperformance and I may change my tune.

Craving more input? Start by adding Manhattan Associates to your free and personalized watchlist so you can keep up on the latest news with the company.

At the time this article was published Fool contributor Sean Williams has no material interest in any companies mentioned in this article. You can follow him on CAPS under the screen name TMFUltraLong, track every pick he makes under the screen name TrackUltraLong, and check him out on Twitter, where he goes by the handle @TMFUltraLong.Try any of our Foolish newsletter services free for 30 days. We Fools don't all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.

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