Why Ruckus Shares Got Rocked

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 Wi-Fi products maker Ruckus Wireless (NYSE: RKUS  ) plummeted 23% today after its quarterly results and outlook missed Wall Street expectations.  

So what: Ruckus' first-quarter revenue jumped 27%, but a 92% plunge in profit, coupled with downbeat guidance for the current quarter, reinforces recent concerns over slowing growth. The company cited weak Chinese demand and delays from its North American carrier customers for the gloomy report, raising plenty of uncertainty over its competitive position and general operating environment going forward.

Now what: Management now sees second-quarter adjusted EPS of $0.03-$0.04 on revenue of $61 million-$64 million, versus Wall Street's view of $0.04 and $67.1 million. "We believe that the fundamentals, growth drivers and long-term market opportunity for Ruckus remain intact," CEO Selina Lo reassured investors. "I believe we have significantly bolstered our technology differentiations and strengthened our competitive advantage in the growing market for public Wi-Fi access equipment." Given the strong headwinds clearly facing Ruckus at this point, however, I'd be highly cautious about buying into that bull talk.

Interested in more info Ruckus? Add it to your watchlist.

It's incredible to think just how much of our digital and technological lives are almost entirely shaped and molded by just a handful of companies. Find out "Who Will Win the War Between the 5 Biggest Tech Stocks?" in The Motley Fool's latest free report, which details the knock-down, drag-out battle being waged by the five kings of tech. Click here to keep reading.


Read/Post Comments (0) | Recommend This Article (2)

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: 2414147, ~/Articles/ArticleHandler.aspx, 10/21/2014 5:32:43 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