Why Rockwood Holdings' Shares Popped

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 specialty chemicals and materials maker Rockwood Holdings (NYS: ROC) jumped 11% in late trading after the company announced earnings this morning.

So what: First-quarter profit fell 57% from a year ago, but adjusted income rose after accounting for a one-time gain a year ago. Revenue was down 1% to $909.5 million, and adjusted income rose 18% to $0.94 per share.

Now what: Both revenue and profits were below expectations, but investors may be looking more at management's comments that demand for lithium products would grow by double digits in 2012. The company was also able to raise prices, and with two new plants coming online there could be room for upside. I'm not seeing any great catalysts to buy today, but keep an eye on earnings in the future as more of the company's supply comes on the market.

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At the time this article was published Fool contributor Travis Hoium has no 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 don't 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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