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 Tile Shop Holdings (TTS +1.45%) were crumbling today, falling as much as 19% and finishing down 7% after it came up short on earnings.
So what: Earnings came up short for the tile retailer as it posted an adjusted profit of $0.08 a share on expectations of $0.10. Revenues, meanwhile, matched estimates, increasing 28.3% to $56.8 million. Tile Shop also had an impressive 14.3% gain in same-store sales in the quarter. CEO Robert Rucker noted that it was the company's second straight quarter with comps north of 14%, and said its strategy has proven to be a winning combination for consumers. Tile Shop maintained its full-year revenue guidance of $227 million to $337 million, whose midpoint matches the analyst consensus.
Now what: With the housing recovery still moving along, an aggressive store expansion, and double-digit same-store sales, Tile Shop looks poised for future growth. Analysts expect sales growth of 30% next year, and the strong comps will improve profitability. I'd say today's drop presents an appealing buying opportunity.
