Why Millennial Media Shares Took Off

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 thesis.

What: Shares of Millennial Media (NYSE: MM  ) were looking rejuvenated today, rising as much as 12% after the company posted impressive results in its preliminary fourth-quarter report.

So what: The mobile-advertising specialist said it now expected revenue of $106 million to $109 million, above its previous guidance at $95 million to $100 million, and it bumped up EBTIDA guidance from breakeven to $2 million to $5 million-$6 million. CFO Michael Avon said, "We are very pleased with the strong fourth quarter performance," and that the company "enters 2014 with a much stronger and more comprehensive suite of capabilities than at this time last year."

Now what: Separately, the company's CEO and founder Paul Palmieri stepped down to take a position as a venture advisor with New Enterprise Associates. In a statement, Palmieri said, "Some time ago, I expressed my desire to the board to transition out of the company, and return to working with early stage entrepreneurs." Normally, the resignation of a founder/CEO would send a young company's stock falling, but given Millennial's strong quarter and Palmieri's desire to use his talents elsewhere, the timing seems right. The company named as its new CEO Michael Barrett, who was most recently the chief revenue officer at Yahoo!. The choice seems like a solid one, as one of Millennial's board members called Barrett "an exceptional leader who has ... [led] teams to big success in the digital advertising industry."

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