Why Triumph's Shares Didn't


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 Triumph Group are down nearly 7%, and reached an intraday low of 10% beneath yesterday's close, after releasing an earnings report that pairs solid quarterly results with disappointing forward guidance.

So what: Triumph's fiscal-fourth-quarter revenue came in at $986.3 million, well ahead of the $942.9 million consensus. Earnings of $1.68 per share likewise topped Wall Street's expectations of $1.59. However, the company's 2014 fiscal year guidance doesn't look too good, as Triumph expects between $3.8 billion and $4 billion on the top line and $6.30-$6.40 in EPS, both of which come in below the consensus numbers of $4.07 billion and $6.85 per share.

Now what: Keep in mind that even the low end of Triumph's 2014 guidance is a moderate improvement over 2013's results of $3.7 billion in revenue and $6.21 in adjusted earnings per share. However, it's not a particularly noteworthy improvement. Triumph remains inexpensive at a P/E barely in the double digits, but it's worth considering that even the high end of EPS guidance offers only a 3% improvement over the current year. If Triumph is to grow its share price this year, it's likely to have to do so on the basis of expanding valuations -- and the market doesn't seem to be interested in that possibility today.

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The article Why Triumph's Shares Didn't originally appeared on Fool.com.

Motley 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 insight into markets, history, and technology.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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