Why On Assignment's Shares Jumped
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 staffing firm On Assignment (NAS: ASGN) jumped 10% briefly in early trading after the company reported earnings.
So what: Revenue nearly doubled from a year ago to $283 million, and net income was $8.5 million, or $0.28 per share after adjusting for acquisition costs. Analysts only expected earnings per share of $0.23, so the market is cheering the better-than-expected results.
Now what: Excluding the Apex Systems acquisition, revenues were still up 28%, so the core business is still very healthy. Management is also expecting conditions to improve in the third quarter, with revenue guidance of $382 million to $388 million and expected earnings per share of $0.28 to $0.31. With these growth numbers, I think the company's 13 forward P/E ratio is a good value for investors and shares can move higher from here.
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The article Why On Assignment's Shares Jumped originally appeared on Fool.com.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.