Why Ubiquiti Networks Got Destroyed
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 Ubiquiti Networks (NAS: UBNT) got pummeled today, down by 19% at the low, after the company reported earnings and concern over its CEO.
So what: Revenue jumped 79% in the third quarter to $91.7 million, with adjusted earnings per share of $0.30. Going forward, Ubiquiti expects next quarter to see revenue between $93 million and $95 million, with adjusted earnings per share in the range of $0.28 to $0.29.
Now what: Perhaps more interestingly, there are reports coming out of China that CEO Robert Pera has ties with the Chinese mafia and has sent goons to rivals' factories to intimidate and harass them in an attempt to get them to shut down. Local news outlets say Pera is now under investigation by local authorities. Pera is a former Apple hardware engineer turned entrepreneur, and Forbes recently profiled him as one of the world's youngest billionaires, thanks to his 64% stake in Ubiquiti. If the reports turn out true, Ubiquiti will have quite a problem on its hands.
Interested in more info on Ubiquiti Networks? Add it to yourWatchlist.
At the time this article was published Fool contributorEvan Niuowns shares of Apple, but he holds no other position in any company mentioned. Check out hisholdings and a short bio. The Fool owns shares of Apple.Motley Fool newsletter serviceshave recommended buying shares of Apple and creating a bull call spread position in Apple. The Motley Fool has adisclosure policy. We Fools don't all hold the same opinions, but we all believe thatconsidering a diverse range of insightsmakes us better investors. Try any of our Foolish newsletter servicesfree for 30 days.
Copyright © 1995 - 2012 The Motley Fool, LLC. All rights reserved. The Motley Fool has a disclosure policy.