Why Pitney Bowes’ Shares Jumped

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 Pitney Bowes (NYSE: PBI  ) jumped 18% today after the company released fourth-quarter earnings.

So what: Revenue fell 1% to $1.29 billion and net income dropped 57% to $110.3 million, or $0.55 per share, but it's all about expectations during earnings season. Analysts only expected $1.28 billion in revenue and $0.51 per share in earnings, which is lower than the $0.56 adjusted EPS number used for comparison, so shares surged higher today.  

Now what: Pitney Bowes isn't a growth company but the market has thrown it out like there's no value left at all. Next year, management expects earnings of $1.85-$2.00 per share and free cash flow of $600 million-$700 million on at least flat revenue. That makes a $2.8 billion market cap and $14.09 share price look like a steal, even after today's jump. I think shares will continue to move higher.

Interested in more info on Pitney Bowes? Add it to your watchlist by clicking here.

Read/Post Comments (1) | Recommend This Article (1)

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.

  • Report this Comment On January 31, 2013, at 5:43 PM, stockmover wrote:

    I've been LONG PBI for almost 2 years and enjoying the consistently high dividend payments. I believe PBI has erroneously been beaten down by the analyst without realizing that management has been transitioning PBI into a larger software company with firm contracts with UPS and Fed Ex. Look for future surprises Fools.

Add your comment.

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: 2228380, ~/Articles/ArticleHandler.aspx, 5/24/2015 9:34:34 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...