Why Shares of IHS Jumped Today
Jan 8th 2013 4:44PM
Updated Jan 8th 2013 4:48PM
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 information publisher IHS jumped as much as 13% in early trading after reporting earnings.
So what: The company said that revenue rose 12% to $414.2 million in the fourth quarter, well ahead of the $409.9 million analysts expected. Net income more than doubled to $46.4 million and excluding one-time items came in at $1.21 per share, also above estimates of $1.11.
Now what: This was a good quarter, but the stock also came with some strange movements today. The stock opened at $109.69, which was the high point of the day and may have been a sign of a little overexuberance on the part of one or two investors. Shares quickly fell to $100 and closed at $102.09. That's still a nice 5.6% gain but nothing like what we saw earlier.
It's often wise to stay away from trading in the first few minutes and the last few minutes of the day, until market makers get their bids and asks in and trading reaches a normal level -- and this is exactly why. Just a couple of hundred shares traded at today's high, and the buyer quickly lost nearly $10 per share in value. But after shares pulled back, I think this stock provides a nice buying opportunity for investors, considering the growth and earnings momentum from IHS.
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The article Why Shares of IHS Jumped Today originally appeared on Fool.com.Travis Hoium has no position in any stocks mentioned. You can follow Travis on Twitter at @FlushDrawFool, check out his personal stock holdings, or follow his CAPS picks at TMFFlushDraw. The Motley Fool has no position in any of the stocks mentioned. 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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