Why OraSure Technologies Was Chewed Up and Spit Out

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 OraSure Technologies (NASDAQ: OSUR  ) , a manufacturer of oral fluid diagnostic products, was chewed up and spit out by investors, sending shares lower by as much as 15% following its fourth-quarter earnings results and 2013 forecast.

So what: Investors don't seem to care too much about what OraSure's done for them lately so much as what it'll do for them in the future. For the fourth quarter, OraSure reported a 6.5% decrease in sales to $22.1 million and a loss of $0.11 per share. Both figures surpassed expectations that called for a loss of $0.14 on revenue of $20.9 million. However, the company's first-quarter guidance missed the mark badly. OraSure anticipates reporting sales of $20 million to $21 million and a loss of $0.18-$0.19, compared to the $23.1 million in sales and $0.12 loss the Street was expecting. OraSure made sure to remind investors that the first quarter is typically its slowest, but couldn't hide the fact that infectious disease test sales will be down.

Now what: Yet again, we have another example of a company whose sales are generally moving in the correct direction, but it can't seem to turn that elusive profit -- and it probably won't until Europe or the U.S.'s economy improves, either! OraSure has had a knack over the past year of easily surpassing estimates when it's time to report, but it's having trouble providing guidance that investors can wrap their hands around. This is a company I'd put on the backburner of your watchlist until it shows that it can be consistently profitable.

Craving more input? Start by adding OraSure to your free and personalized watchlist so you can keep up on the latest news with the company.

While you can certainly make huge gains in biotech and diagnostic companies like OraSure, the best investing approach is to choose great companies and stick with them for the long term. In our free report "3 Stocks That Will Help You Retire Rich," we name stocks that could help you build long-term wealth and retire well, along with some winning wealth-building strategies that every investor should be aware of. Click here now to keep reading.


Read/Post Comments (0) | Recommend This Article (0)

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.

Be the first one to comment on this article.

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: 2242802, ~/Articles/ArticleHandler.aspx, 9/2/2014 8:30:20 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...


Advertisement