Why Investment Technology Group Shares Popped

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 Investment Technology Group (NYSE: ITG  ) , a global independent research and execution broker, jumped as much as 10% after reporting its first-quarter results.

So what: For the quarter, Investment Technology Group reported a 3% decrease in revenue to $132.1 million, and an adjusted profit of $0.24 per share, which is up from the $0.14 in EPS reported during the same period last year. ITG attributed its strong results to strength in its European business and its first sequential increase in U.S. revenue capture since the first quarter of 2011. By comparison, the Street had only been expecting ITG to report a profit of $0.17 per share on $131.2 million in revenue.

Now what: From a positive perspective, ITG is doing a really good job of controlling its expenses and improving its operating efficiencies worldwide. However, ITG is also contending with weak trading volumes in many of its markets, which tends to put the company in the back seat rather than the driver's seat when it comes to boosting its bottom line. With that in mind, even at a reasonable 14 times forward earnings, I'd rather stay firmly on the sidelines.

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

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