Why U.S. Ecology's Shares Popped

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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 waste management company U.S. Ecology jumped as much as 21.3% in early trading before settling into a 12% gain midway through the day.

So what: The driver of today's pop was third-quarter earnings, which were much better than investors expected. Revenue rose 16% to $53.1 million and net income was up 18% to $10.3 million, or $0.56 per share. Excluding one-time items, earnings were $0.53 per share, which came in $0.07 ahead of estimates.  

Now what: Treatment and disposal revenue rose 10% sequentially and transportation revenue was up 48% on strong bookings, which look like they'll continue. Management increased full-year earnings guidance to $1.68-$1.73 per share from a previous range of $1.45-$1.55 per share. Shares aren't cheap at 24 times the top end of that range, but I think 2014 looks strong and the company is positioned well to capture growth in the future.

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The article Why U.S. Ecology's Shares Popped originally appeared on Fool.com.

Fool contributor Travis Hoium 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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