May 4, 2012
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 information technology company ManTech International (Nasdaq: MANT ) plunged 14% today after its quarterly results and outlook came in below Wall Street expectations.
So what: ManTech's wide first-quarter miss -- EPS of $0.69 versus the consensus of $0.77 -- coupled with a disappointing full-year outlook confirms fears over its growth prospects going forward. The profit-pressuring headwind of soft government spending on defense and IT consulting shows no sign of abating, forcing analysts to lower their price targets on the stock yet again.
Now what: Management now sees full-year EPS of $3.06 on revenue of $3 billion, below Wall Street's view of $3.50 and $3.1 billion. "With lower than anticipated award activity and decreases in scope on overseas intelligence, surveillance, and reconnaissance mission support, we now expect more modest growth across the enterprise in the immediate term," CFO Kevin Phillips cautioned. Of course, with the stock hitting a new 52-week low today -- down 45% from its July highs -- and sporting a juicy 3%-plus dividend yield, much of the risk might already be baked into the price.
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