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: After an early slide that shaved nearly 10% off its value, Tangoe has regained some ground and now sits at a 6% loss. The company's shares fell following mixed guidance, but on balance it seems to not have been worth the morning drop.
So what: For the completed fourth quarter, Tangoe reported $44 million in revenue and adjusted earnings of $0.17 per share. This was a double beat, as Wall Street sought $42.5 million on the top line and $0.16 in EPS. However, Tangoe's guidance for both the first quarter and the full year appears a bit underwhelming. For the in-progress quarter, Tangoe expects between $43.8 million and $44.3 million in revenue and $0.14 in EPS against the consensus of $44.3 million in revenue and $0.14 in EPS. For the full year, Tangoe's guidance is slightly better, as the company expects $188.5 million to $191.5 million in revenue and between $0.67 and $0.70 in EPS, which compares to Wall Street's consensus of $191 million in revenue and $0.64 in EPS.
Now what: Full-year guidance represents, at the high end, a 40% increase from 2012's adjusted EPS of $0.50, which isn't too shabby, and would provide an adjusted P/E around 22, based on the company's current share price. Tangoe's trailing-12-month free cash flow has also been on a strong upwards trajectory before this report, which indicates a healthier company than its GAAP losses might suggest. The market doesn't seem to know how to handle Tangoe's guidance, which might be a buying opportunity. It could be worth the effort to dig deeper into this company's key data points.
Want more news and updates? Add Tangoe to your watchlist now.
A fresh idea for 2013
The Motley Fool's chief investment officer has selected his No. 1 stock for the next year. Find out which stock it is in our brand-new free report: "The Motley Fool's Top Stock for 2013." I invite you to take a copy, free for a limited time. Just click here to access the report and find out the name of this under-the-radar company.
The article Why Tangoe Shares Tanked originally appeared on Fool.com.Fool contributor Alex Planes has no position in any stocks mentioned. 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.
Copyright © 1995 - 2013 The Motley Fool, LLC. All rights reserved. The Motley Fool has a disclosure policy.