Why Copano Energy's Shares Plunged

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 natural-gas-service provider Copano Energy (NAS: CPNO) saw shares fall as much as 14% today after announcing earnings.

So what: During the first quarter of 2012 revenue increased 16% to $337.2 million and net loss was $147.7 million, affected by a $148.7 million in non-cash impairments. Analysts had expected the company to lose a penny per share, so the bottom line was about in-line with expectations after the impairments.

Now what: What really has investors on edge is comments management made about realizing value in the Eagle Ford Shale play. In the earnings release, CEO R. Bruce Northcutt said, "[Operational] challenges in handling the very rich Eagle Ford Shale volumes will limit our ability to realize the full value of our Eagle Ford Shale projects until the second quarter of 2013, when our first cryo expansion and additional contracted fractionation capacity are expected to come online." I would like to see the company turn a profit before jumping in so I'll be sitting on the sidelines even after today's hefty discount in shares.

Interested in more info on Copano Energy? Add it to your watchlist byclicking here.

At the time this article was published Fool contributor Travis Hoium does not have a 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 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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