Why Copa Holdings' Shares Dropped


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 airline company Copa Holdings dropped 12% today, after the company reported earnings.

So what: Revenue jumped 17.7% in the fourth quarter, to $599.8 million, and net income fell 17%, to $86.6 million, or $1.95 per share. On an adjusted basis, earnings were $2.01 per share, which was short of the $2.23 analysts expected.

Now what: The company's yield is down significantly from a year ago, and that offset the nice rise in revenue. Still, shares are only trading at nine times next year's earnings estimates and, with revenue still growing, the company has a lot of potential. I think this drop is a bit overdone given the company's growth, and think the stock will pop back in coming quarters.

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The article Why Copa Holdings' Shares Dropped 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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