Why On Assignment Got Fired Today
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 fell 11% today, after reporting earnings.
So what: Fourth quarter revenue rose 1.6% sequentially, to $401.7 million, which was at the high end of the company's estimates. The problem is that net income was only $11.3 million, or $0.21 per share, and Wall Street was expecting $0.28 per share.
Now what: Net income was up from $7.5 million a year ago, but with the stock trading at 25 times earnings, there was more growth expected. It's also not encouraging that management expects net income to fall to $8.8 million to $10.5 million -- or $0.16 to $0.19 per share -- next quarter, when analysts are expecting $0.23 per share in earnings. I don't think there's any reason to buy today on slow growth and disappointing earnings.
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The article Why On Assignment Got Fired Today originally appeared on Fool.com.Fool contributor Travis Hoium has no position in any stocks mentioned. 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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