Why Anika Therapeutics Shares Skyrocketed
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 tissue repair products specialist Anika Therapeutics, Inc. soared 26% today after its quarterly results and outlook impressed Wall Street.
So what: The stock has soared over the past two years on a string of better-than-expected growth, and today's wide Q2 beat -- EPS of $0.40 versus the consensus of $0.23 -- coupled with a positive outlook only reinforces that momentum. In fact, revenue increased a solid 6% while gross margins expanded to 68.5%, from 57.2%, suggesting that its competitive position and operating efficiency are improving rapidly.
Now what: Management expected continued growth and profitability improvement for the rest of 2013.
"Our viscosupplementation business is strong, and we are driving efficiencies in our operations and manufacturing," said President and CEO Charles H. Sherwood. "We are also enthusiastic about our product pipeline."
Of course, with the stock now up a whopping 180% over its 52-week lows and trading at a 20-plus forward P/E, much of that enthusiasm might already be baked into the valuation.
It's no secret that biotech stocks have been soaring recently, but the best investment strategy is to pick great companies and stick with them for the long term. The Motley Fool's free report "3 Stocks That Will Help You Retire Rich" not only shares stocks that could help you build long-term wealth, but also winning strategies that every investor should know. Click here to grab your free copy today.
The article Why Anika Therapeutics Shares Skyrocketed originally appeared on Fool.com.
Fool contributor Brian Pacampara 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.
Copyright © 1995 - 2013 The Motley Fool, LLC. All rights reserved. The Motley Fool has a disclosure policy.