Track the companies that matter to you. It's FREE! Click one of these fan favorites to get started: Apple; Google; Ford.



Why LeapFrog Stock Got Dumped

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 LeapFrog Enterprises (UNKNOWN: LF.DL  ) were getting left behind today, finishing down 8% after providing disappointing guidance in its third-quarter report.

So what: The children's educational toy-maker actually beat EPS estimates with a profit of $0.37 against $0.32 estimates, though sales missed the mark. However, the company sharply reduced its expectations for the all-important holiday quarter. CEO John Barbour said, "We are well positioned for the holidays with improving in-stocks and stronger retail promotions, but at the same time, we see a weak retail climate an growing concern surrounding this holiday season, especially in the U.S." As a result, LeapFrog said it expected full-year sales of just $570 million to $590 million, about even with last year, and EPS of $0.36-$0.46.

Now what: The outlook was greeted with boos from the market and downgrades from at least one analyst; however, this company's guidance seems awfully conservative. Breaking down the outlook for just the fourth quarter, it means LeapFrog sees a per-share figure of up to only $0.18 in the current, and it expects revenue similar to the third quarter even though the holiday season is usually much stronger. Either management is lowballing it here, or they know something they're not telling us. To blame that much of a drop on macroeconomics and a shorter holiday season seems a bit absurd.

Where the growth stocks are
Tired of watching your stocks creep up year after year at a glacial pace? Motley Fool co-founder David Gardner, founder of the world's No. 1 growth-stock newsletter, has developed a unique strategy for uncovering truly wealth-changing stock picks. And he wants to share it, along with a few of his favorite growth stock superstars, with you! It's a special 100% free report called "6 Picks for Ultimate Growth." So stop settling for index-hugging gains, and click here for instant access to a whole new game plan of stock picks to help power your portfolio.

Read/Post Comments (1) | 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.

  • Report this Comment On November 05, 2013, at 10:26 PM, Realexpectations wrote:

    They beat every quarter and they sandbag every quarter

    someone needs to tell them they're not special

Add your comment.

Compare Brokers

Fool Disclosure

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: 2714010, ~/Articles/ArticleHandler.aspx, 9/25/2016 6:58:47 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...

Today's Market

updated 1 day ago Sponsored by:
DOW 18,261.45 -131.01 -0.71%
S&P 500 2,164.69 -12.49 -0.57%
NASD 5,305.75 -33.78 -0.63%

Create My Watchlist

Go to My Watchlist

You don't seem to be following any stocks yet!

Better investing starts with a watchlist. Now you can create a personalized watchlist and get immediate access to the personalized information you need to make successful investing decisions.

Data delayed up to 5 minutes

Related Tickers

4/5/2016 4:05 PM
LF.DL $0.00 Down +0.00 +0.00%
LeapFrog Enterpris… CAPS Rating: ***