May 11, 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 Home Inns & Hotels Management (Nasdaq: HMIN ) jumped as much as 10% in trading today after the company released earnings.
So what: Revenue increased 66% from a year ago to $199.4 million, and the company reported a net loss of $14.8 million, or $0.18 per share. Analysts had expected revenue of $183.6 million and a loss of $0.03 per share.
Now what: Revenue growth was impressive, but I'm more worried about the loss on the bottom line. EBITDA was also down significantly from a year ago, so the company isn't squeezing as much out of the business as it used to. Analysts expect the bottom line to turn around quickly and for the company to post $1.04 per share in earnings during 2012, but I'd like to see some bottom-line results before buying into this growth story.
Interested in more info on Home Inns & Hotels Management? Add it to your Watchlist.
More Expert Advice from The Motley Fool
The Motley Fool's chief investment officer has selected his No. 1 stock for the next year. Find out which stock in our brand-new free report: "The Motley Fool's Top Stock for 2013
." I invite you to take a copy, free for a limited time. Just click here
to access the report and find out the name of this under-the-radar company.