Ion Geophysical Shares Plunged: 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 Ion Geophysical (NYS: IO) fell 10% today after the company released earnings.

So what: Fourth-quarter revenues barely budged from a year earlier, coming in at $159.9 million. Net income was $12 million, but when you strip out "special items," earnings were a much more impressive $23.2 million, or $0.15 per share, in line with estimates.

Now what: Full-year numbers were similar with revenue barely growing over last year. With all of the expansion in drilling both on and offshore, expectations for growth are higher than Ion is giving, hence the drop in shares today. 2011 earnings per share were just $0.22, meaning shares are trading at 33 times trailing earnings, a steep price for a company that isn't growing revenue at a rapid pace.

Interested in more info on Ion Geophysical? 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.

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