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 intellectual property owner Acacia Research (NASDAQ: ACTG) fell 26% today after the company released earnings.
So what: Revenue fell 22% to $76.9 million and net income dropped 90% to $5.1 million, or $0.11 per share. On an adjusted basis, earnings per share were $0.47, which was actually $0.05 ahead of estimates.
Now what: It's inherently difficult for to predict quarterly results, but the trends are what's important here. On one-year trailing basis, revenue fell 9%, which isn't a strong trend for the company. This is just way too volatile a business for me to buy in right now, and I don't see the trends moving in the right direction, particularly on the bottom line.
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