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What: Shares of casino game designer WMS Industries (NYS: WMS) were hitting the jackpot today, tacking on as much as 15% in intraday trading after the company reported fiscal-second-quarter results.
So what: In a lot of ways, WMS' second quarter didn't look good at all. Both revenue and profit per share fell short of analysts' expectations. As compared to the same quarter of fiscal 2011, it wasn't any prettier. Total revenue fell 19% on a year-over-year basis, while operating profit dropped 43%.
Now what: So why, you might ask, is the stock shooting up today? Because while results from the past quarter may be disappointing, investors are much more concerned about what the future holds. And if you believe WMS' management team, the future looks decidedly brighter.
In the earnings press release, CEO Brian Gamache confidently stated that "the inflection point in our operating and financial performance is now behind us." Continuing the upbeat view, in its outlook for the rest of fiscal 2012, management said it expects the back half of fiscal 2012 will show year-over-year growth in terms of both revenue and profit margin.
Despite the lackluster numbers, that certainly sounds like a reason for some investor optimism.
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