Why Shares of Tenneco Jumped

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 vehicle part manufacturer Tenneco (NYS: TEN) rose 10% today after the company released second-quarter earnings.

So what: Tenneco said that revenue rose 1.7% to $1.92 billion, which was below estimates of $2.03 billion, but the bottom line made up for that miss. Earnings per share were $1.14, exceeding the $0.97 analysts had expected by a wide margin.


Now what: Europe was a drag on the quarter, as it has been for most companies reporting earnings. But the strong bottom-line numbers have given investors confidence that the company can leverage its business despite the fact that revenue isn't growing. If it can, the stock should continue to rise because the company's forward earnings multiple is just 6.7, a cheap valuation if it can sustain the current earnings momentum.

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

The article Why Shares of Tenneco Jumped originally appeared on Fool.com.

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