Why Logitech International Shares Leaped

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 Logitech International soared 22% today after the computer accessories company's quarterly results and outlook topped Wall Street expectations.

So what: The stock has soared over the past year on improving fundamentals, and today's blowout third quarter -- adjusted earnings per share of $0.35 on revenue of $627.9 million versus the consensus of $0.22 and $534.4 million -- coupled with upbeat full-year guidance only reinforces that trend. In fact, Logitech's retail growth categories -- tablet accessories, audio, and PC gaming -- combined for a 62% surge in sales from the year-ago period, suggesting that management is investing in all the right places in order to return to profitable and rapid growth.

Now what: Management now sees full-year 2014 operating income of $120 million-$125 million on revenue of about $2.1 billion, up from its prior view of $100 million and $2 billion. "We're encouraged by the robust sales in our growth categories, as well as the success of our ongoing initiatives to improve profitability, which includes the earlier-than-expected return to profitability of LifeSize," said President and CEO Bracken Darrell. "We still have more work ahead, but our turnaround is on track as we continue to build a faster and more profitable Logitech." Of course, with the stock now up a whopping 160% over its 52-week lows and trading at a 30-plus forward P/E, much of that bullishness might already be baked into the price.

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The article Why Logitech International Shares Leaped originally appeared on Fool.com.

Fool contributor Brian Pacampara has no position in any stocks mentioned. The Motley Fool recommends Logitech International SA (USA). 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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