Why Manhattan Associates Shares are Movin' on Up
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 Manhattan Associates are up by about 9% today after gaining as much as 14% following a strong earnings report paired with good forward guidance.
So what: Manhattan Associates posted fourth-quarter revenue of $95.4 million, with $0.71 per share in adjusted earnings per share. Both those numbers came in ahead of forecasts -- analysts were looking for $92.2 million on the top line and $0.66 in EPS. Equally important (if not more so), Manhattan Associates also sees revenue of $410 million to $415 million for the 2013 fiscal year, with $3.15 to $3.21 in EPS. The Street was looking at $410.6 million on the top line and $3.10 per share in profit, so both are good news. On an adjusted basis, the company's projected EPS figure is about 14% higher than what it earned for the 2012 fiscal year.
Now what: Although this report is good news, I'd dig deeper before deciding that a 14% growth rate is worth investing in. After this pop, Manhattan Associates is trading at its highest P/E in three years, which is now 16% above the level it reached exactly three years ago and 50% higher than its level in the summer. Keep your eye on this stock, but don't take today's pop as a reason to add it to your portfolio.
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The article Why Manhattan Associates Shares are Movin' on Up originally appeared on Fool.com.Fool contributor Alex Planes holds no financial position in any company mentioned here. Add him on Google+ or follow him on Twitter @TMFBiggles for more news and insights. The Motley Fool has no position in any of the stocks mentioned. 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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