Cubist Pharmaceuticals Shares Popped: 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: Shares of Cubist Pharmaceuticals (NAS: CBST) jumped 10% today after the company released earnings.

So what: Revenue rose 24% to $201.7 million on better than expected sales of Cubicin antibiotic injection. Earnings per share hit $0.33 per share, $0.02 higher than estimates, and Cubist raised its 2011 revenue outlook to $740 million to $745 million.

Now what: Analysts were only expecting 2011 revenue of $711.7 million, so sales are vastly outpacing expectations. A forward P/E ratio of more than 24 is a bit too much for this Fool considering the earnings beat was only by $0.02. Nevertheless, the news is positive for Cubist after a disappointing second quarter.

Interested in more info on Cubist Pharmaceuticals? Add it to your watchlist byclicking here.

At the time this article was published Fool contributor Travis Hoium does not have a position in any company mentioned. You can follow Travis on Twitter at @FlushDrawFool, check out his personal stock holdings or follow his CAPS picks at TMFFlushDraw.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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