Why Scholastic Shares Tumbled

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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 Scholastic were sliding again today, falling as much as 10% after the company posted another disappointing earnings report.

So what: The children's publishing house said revenue slid 25%, to $506.9 million, as sales fell off from the hit trilogy The Hunger Games, a major revenue stream since it debuted. Earnings per share from continuing operations, meanwhile, came in at $0.76 per share, down from $1.86 a year ago. Both results were below the mark set by the one analyst covering Scholastic. The company, which once had a lock on children's education and media, has been struggling to shift into the digital age, as investments in e-books and other online portals has weighed on profits.

Now what: Like the publishing industry in general, Scholastic is struggling to maintain its relevance, as the advent of electronic media has turned the industry upside down. The company can't count on blockbusters like The Hunger Games every year, but management said it expects to improve profitability in the next fiscal year with the introduction of a number of education technology products, and projects an EPS from continuing operations between $1.40 and $1.80, excluding items. Those numbers aren't terrible, but I'd wait to see consistent revenue and profits before getting on board.

Want more on Scholastic? Add the company to your Watchlist by clicking right here.

The article Why Scholastic Shares Tumbled originally appeared on Fool.com.

Fool contributor Jeremy Bowman has no position in any stocks mentioned. The Motley Fool has no position in any of the stocks mentioned. 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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