Why Southcross Energy Partners' Shares Dropped

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 natural gas service provider Southcross Energy Partners (NYSE: SXE  ) fell 19% today after reporting fourth-quarter results.

So what: Revenue rose 9%, to $151.7 million, but fell short of the $160.2 million that analysts expected. Net loss was $7.9 million, or $0.17 per share, when analysts expected a $0.10 per share profit.

Now what: Anytime results are that far off, investors get nervous, but especially in the first report after an IPO. Management said it made some moves that will result in better financial results in May, but I wouldn't take the risk right now. I'd make Southcross prove its performance, especially since it's a newly public company.

Interested in more info on Southcross Energy Partners? Add it to your watchlist by clicking here.


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