MKS Instruments Shares Plunged: What You Need to Know

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 manufacturing equipment specialist MKS Instruments (Nasdaq: MKSI  ) fell as much as 10% in early trading on average volume. The stock has since recovered, down less than 1% as of this writing.

So what: What gives? MKS ruined a perfectly good third-quarter report with a dour Q4 outlook. Let's cover the good news first. Q3 revenue fell 12% to $194.5 million while adjusted earnings dropped 19% to $0.58 a share. Analysts were more pessimistic, expecting just $0.48 a share on $190.6 million in revenue.

Now what: The bad news? Wall Street expected MKS to make up the shortfall and then some in Q4. Instead, management forecast $0.18 to $0.31 in adjusted earnings on $145 to $165 million in revenue -- well off not only last year's totals, but also the $0.43 and $182.7 million analysts were expecting. The intraday rally suggests Big Money investors may be trying to catch this falling knife. Be careful following them, Fool: You might get cut. Do you agree? Would you buy shares of MKS Instruments at current prices? Please weigh in using the comments box below.

Interested in more info about MKS Instruments? Add it to your watchlist by clicking here.

Fool contributor Tim Beyers is a member of the Motley Fool Rule Breakers stock-picking team. He didn't own shares in any of the companies mentioned at the time of publication. Check out Tim's portfolio holdings and Foolish writings, or connect with him on Google+ or Twitter, where he goes by @milehighfool. You can also get his insights delivered directly to your RSS reader.

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.


Read/Post Comments (0) | Recommend This Article (0)

Comments from our Foolish Readers

Help us keep this a respectfully Foolish area! This is a place for our readers to discuss, debate, and learn more about the Foolish investing topic you read about above. Help us keep it clean and safe. If you believe a comment is abusive or otherwise violates our Fool's Rules, please report it via the Report this Comment Report this Comment icon found on every comment.

Be the first one to comment on this article.

Sponsored Links

Leaked: Apple's Next Smart Device
(Warning, it may shock you)
The secret is out... experts are predicting 458 million of these types of devices will be sold per year. 1 hyper-growth company stands to rake in maximum profit - and it's NOT Apple. Show me Apple's new smart gizmo!

DocumentId: 1573726, ~/Articles/ArticleHandler.aspx, 11/23/2014 10:20:08 PM

Report This Comment

Use this area to report a comment that you believe is in violation of the community guidelines. Our team will review the entry and take any appropriate action.

Sending report...


Advertisement