Partner Communications Shares Plunged: What You Need to Know
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 Israeli cell-service provider Partner Communications (NAS: PTNR) were getting hung up on by investors today as shares fell as much as 22% in intraday trading on heavier-than-average volume.
So what: There's one thing that I know for sure: Companies do not want to report bad news to investors right now. With the market going absolutely berserk, any whiff of bad news can send shares into a tailspin. In Partner's case, the news was bad and the reaction has obviously been intense. For the second quarter, Partner's profit missed analysts' estimates as it fell 30% from a year ago. Possibly even worse, the company opted to shut off its dividend spigot.
Now what: Because Partner's stock previously had such a hefty dividend yield, a fair bit of the selling today could be incensed dividend investors running for the hills. Partner's management blamed the lousy quarter on previously-discussed regulatory changes in the Israeli mobile market. However, the discontinued dividend was explained as stemming from "the significant increase in the level of uncertainty in the global economy and the Israeli economy," so investors may not be able to count on a quick turnaround for Partner's fortunes.
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