WMS Industries Shares Jumped: What You Need to Know

Before you go, we thought you'd like these...
Before you go close icon

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 casino game designer WMS Industries (NYS: WMS) were hitting the jackpot today, tacking on as much as 15% in intraday trading after the company reported fiscal-second-quarter results.

So what: In a lot of ways, WMS' second quarter didn't look good at all. Both revenue and profit per share fell short of analysts' expectations. As compared to the same quarter of fiscal 2011, it wasn't any prettier. Total revenue fell 19% on a year-over-year basis, while operating profit dropped 43%.

Now what: So why, you might ask, is the stock shooting up today? Because while results from the past quarter may be disappointing, investors are much more concerned about what the future holds. And if you believe WMS' management team, the future looks decidedly brighter.

In the earnings press release, CEO Brian Gamache confidently stated that "the inflection point in our operating and financial performance is now behind us." Continuing the upbeat view, in its outlook for the rest of fiscal 2012, management said it expects the back half of fiscal 2012 will show year-over-year growth in terms of both revenue and profit margin.

Despite the lackluster numbers, that certainly sounds like a reason for some investor optimism.

Want to keep up to date on WMS Industries?Add it to your watchlist.

At the time this article was published 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.Fool contributor Matt Koppenheffer does not have a financial interest in any of the companies mentioned. You can check out what Matt is keeping an eye on by visiting his CAPS portfolio, or you can follow Matt on Twitter @KoppTheFool or Facebook. The Fool's disclosure policy prefers dividends over a sharp stick in the eye.

Copyright © 1995 - 2012 The Motley Fool, LLC. All rights reserved. The Motley Fool has a disclosure policy.

Read Full Story

Want more news like this?

Sign up for Finance Report by AOL and get everything from business news to personal finance tips delivered directly to your inbox daily!

Subscribe to our other newsletters

Emails may offer personalized content or ads. Learn more. You may unsubscribe any time.

From Our Partners