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 paint company Valspar (NYSE: VAL) opened Monday trading up 11% after its quarterly results topped Wall Street expectations.
So what: Unfortunately for Valspar investors, the stock quickly erased most of those gains within the first half-hour of trading and is only up about 2% at the time of publication. While the company managed to post a solid third-quarter (adjusted earnings per share of $0.80 versus the analyst consensus of $0.79), the forward-looking Mr. Market seems disappointed that management simply reaffirmed, and didn't raise, its full-year guidance.
Now what: I'd look into Valspar as a possible value pick. The stock is down more than 20% over the past three months alone, sports a cheapish forward P/E of 10, and boasts a solid dividend yield of roughly 2.5%. Given Valspar's leading competitive position in several markets and exciting emerging market expansion, the current valuation seems more than reasonable.
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