August 3, 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 technology company American Science & Engineering (Nasdaq: ASEI ) rose 13% today after the it reported earnings.
So what: Revenue fell 7% from last year to $47.3 million and net income fell to $4.2 million, or $0.47 per share. Despite the decline from last year the EPS number was $0.05 better than Wall Street expected. The company also announced a $35 million share repurchase program.
Now what: I'm concerned about the declining revenue and earnings, despite the fact both were better than estimates. For the current fiscal year analysts are expecting EPS to decline to $2.28, meaning that shares are still trading at 27 times earnings. That's a lot to pay when earnings are declining and will keep me from buying the stock today.
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