Why Scheitzer-Mauduit's Shares Dropped
Feb 7th 2013 9:10PM
Updated Feb 7th 2013 10:05PM
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 paper maker Schweitzer-Mauduit International dropped 10% today, after releasing earnings.
So what: Revenue fell 8%, to $196.8 million in the quarter, and net income dropped 65%, to $16.5 million, or $0.53 per share. Adjusted EPS, which takes out on-time items, was $0.88, but still fell $0.10 short of estimates.
Now what: The fourth quarter results were uninspiring, and guidance didn't help either. The company expects earnings of $3.70 per share next year, well below the $4.09 analysts expected. I don't see operations improving any time soon, and the best-case scenario seems to be flat revenue going forward. That's not a buy signal to me, so I'll avoid this discount today.
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The article Why Scheitzer-Mauduit's Shares Dropped originally appeared on Fool.com.Fool contributor 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 may not 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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