Why ION Geophysical Corp. 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 ION Geophysical popped 24% Thursday after the company reported better than expected fourth-quarter results.
So what: Quarterly revenue rose 26% year over year to $218.7 million, which translated to adjusted earnings of $0.33 per diluted share. Analysts, on average, expected earnings of just $0.06 per share on significantly lower sales of $126.52 million.
Now what: This was a massive beat, but keep in mind that CEO Greg Heinlein admitted this may not always be typical: "We had a strong finish in 2013, with every part of our business contributing. Our data library continues to focus on the right places of the world where exploration spending is occurring. While not always consistent, we believe this quarter demonstrates that we remain well positioned for future licensing rounds."
As a result, Heinlein declined to provide specific forward guidance for the company, instead choosing to say, "Our outlook for 2014 remains cautious until we see clarity in E&P spending between exploration and production."
In the end, I'll admit a beat of this magnitude makes it hard to take analysts' expectations seriously, but the stock does look relatively cheap at roughly 15.7 times next year's estimated earnings and with a rock-bottom price to earnings growth ratio of 0.60. At the very least, then, I think investors would do well to add ION Geophysical to their watchlists as a potential portfolio addition down the road.
The 9 stocks in this free report are as predictable as they come (in a good way)
In the meantime, there are plenty of other great stocks out there. So where should you look?
One of the dirty secrets that few finance professionals will openly admit is the fact that dividend stocks as a group handily outperform their non-dividend paying brethren. The reasons for this are too numerous to list here, but you can rest assured that it's true. However, knowing this is only half the battle. The other half is identifying which dividend stocks in particular are the best. With this in mind, our top analysts put together a free list of nine high-yielding stocks that should be in every income investor's portfolio. To learn the identity of these stocks instantly and for free, all you have to do is click here now.
The article Why ION Geophysical Corp. Shares Skyrocketed originally appeared on Fool.com.
Steve Symington 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 - 2014 The Motley Fool, LLC. All rights reserved. The Motley Fool has a disclosure policy.