CIRCOR International Shares Dropped: What You Need to Know

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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: Seems like everything is down today, but CIRCOR International (NYS: CIR) is down more than most -- 21% and counting.

So what: CIRCOR reported $0.44 per share in second-quarter adjusted profit -- more than 10% below Street expectations. Oops.

Now what: Adding insult to injury, the valve-maker warned that Q3 is looking pretty weak as well. Management is guiding toward about $0.52 per share, versus the $0.63 per-share profit that Wall Street has it pegged for. When you take all that and factor in the stock's high price (40 times earnings) and total lack of free cash flow (CIRCOR actually burned about $60 million over the past 12 months), I can't say I'm optimistic about CIRCOR rebounding anytime soon.

Are you feeling optimistic about CIRCOR?Add it to your Fool watchlist. See if maybe they can turn this thing around.

At the time this article was published Fool contributorRich Smithdoes not own (or short) shares of CIRCOR. The Motley Fool has adisclosure policy. Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors.

Copyright © 1995 - 2011 The Motley Fool, LLC. All rights reserved. The Motley Fool has a disclosure policy.

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