Why CaesarStone's Shares Popped

By Travis Hoium – Feb 6, 2013 at 5:10PM

NASDAQ: CSTE

Caesarstone

Market Cap

$232M

Today's Change

(4.02%) $0.26

Current Price

$6.73

Price as of April 24, 2024, 4:00 p.m. ET

Is this meaningful or just another movement?

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 CaesarStone (CSTE 4.02%) jumped as much as 13% today after releasing earnings.

So what: Fourth-quarter revenue was up 12.6% to $76.2 million, and net income nearly doubled to $10.8 million, or $0.31 per share. Analysts expected revenue of only $73.2 million and earnings of $0.30 per share.

Now what: Even better than last quarter's earnings were the company's guidance of revenue of $330 million to $340 million next year. Analysts expected only $327 million in revenue next year, so the company is expected to easily outpace expectations. Shares now trade at 14 times next year's earnings estimates, and at that price I think there's still upside in shares going forward.

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Fool contributor Travis Hoium has no position in any stocks mentioned. You can follow Travis on Twitter at @FlushDrawFool, check out his personal stock holdings, or follow his CAPS picks at TMFFlushDraw.

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