Why Multimedia Games' 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 Multimedia Games jumped as much as 22% today after the company reported earnings.
So what: In the fiscal first quarter, the company's revenue jumped 27.3% to $44.3 million, easily topping the $39.8 million mark Wall Street had set. On the bottom line, earnings per share hit $0.24, well above the $0.13 estimate.
Now what: The company's TournEvent slot system is driving most of the momentum, with nearly half of the total units sold in the quarter. Management is confident that growth will continue as momentum builds around the world, and for investors this is an interesting growth story. I'd like to see a pullback before jumping in because the forward P/E ratio of 21 is a little high, but I think shares can move higher long-term on these strong results.
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The article Why Multimedia Games' Shares Popped originally appeared on Fool.com.Fool contributor Travis Hoium has no position in any stocks mentioned. You can follow Travis on Twitter at @FlushDrawFool, check out his personal stock holdings, or follow his CAPS picks at TMFFlushDraw. 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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