Why Glu Mobile, Inc. Shares Skyrocketed

Is Glu Mobile's jump meaningful? Or just another movement?

Feb 6, 2014 at 5:49PM

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 Glu Mobile, (NASDAQ:GLUU) jumped nearly 28% Thursday after the freemium mobile game specialist delivered better-than-expected fourth-quarter results and forward guidance.

So what: Quarterly adjusted revenue rose 62% year over year to $42.8 million, which translated to adjusted net income of $0.07 per share, compared to a $0.05 per-share loss in the same year-ago period. Meanwhile, analysts were only looking for a breakeven quarter on sales of $32.2 million.

Going forward, Glu Mobile expects adjusted 2014 revenue to be between $142 million and $150 million, with adjusted net income from between $0.00 and $0.02 per share. Analysts were modeling a $0.05 per-share loss on sales of $121.4 million.

Now what: CEO Niccolo de Masi weighed in: "We believe we have begun a new era at Glu. One with solid foundations for a more predictable and sustainably adjusted EBITDA profitable, operational rhythm."

Today's optimism may continue to drive Glu Mobile from here, but keep in mind the company is still losing money based on generally accepted accounting standards. In the end, I simply have a hard time accepting the challenges and bad economics behind effectively monetizing free-to-play games. Before I'd be willing to consider Glu Mobile for my own portfolio, I want to know the company can ultimately achieve sustained profitability -- on a GAAP basis -- over the long-term.

Consider the six incredible growth stocks in this free report
In the meantime, there are plenty of other great growth stocks out there. So where should you look?

Consider the investing expertise of Motley Fool co-founder David Gardner, who has proved skeptics wrong, time, and time, and time again, with stock returns like 926%, 2,239%, and 4,371%. In fact, just recently, one of his favorite stocks became a 100-bagger. And he's ready to do it again. You can uncover his scientific approach to crushing the market and his carefully chosen six picks for ultimate growth instantly, because he's making this premium report free for you today. Click here now for access.

Steve Symington has no position in any stocks mentioned. The Motley Fool has no position in any of the stocks mentioned. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.

4 in 5 Americans Are Ignoring Buffett's Warning

Don't be one of them.

Jun 12, 2015 at 5:01PM

Admitting fear is difficult.

So you can imagine how shocked I was to find out Warren Buffett recently told a select number of investors about the cutting-edge technology that's keeping him awake at night.

This past May, The Motley Fool sent 8 of its best stock analysts to Omaha, Nebraska to attend the Berkshire Hathaway annual shareholder meeting. CEO Warren Buffett and Vice Chairman Charlie Munger fielded questions for nearly 6 hours.
The catch was: Attendees weren't allowed to record any of it. No audio. No video. 

Our team of analysts wrote down every single word Buffett and Munger uttered. Over 16,000 words. But only two words stood out to me as I read the detailed transcript of the event: "Real threat."

That's how Buffett responded when asked about this emerging market that is already expected to be worth more than $2 trillion in the U.S. alone. Google has already put some of its best engineers behind the technology powering this trend. 

The amazing thing is, while Buffett may be nervous, the rest of us can invest in this new industry BEFORE the old money realizes what hit them.

KPMG advises we're "on the cusp of revolutionary change" coming much "sooner than you think."

Even one legendary MIT professor had to recant his position that the technology was "beyond the capability of computer science." (He recently confessed to The Wall Street Journal that he's now a believer and amazed "how quickly this technology caught on.")

Yet according to one J.D. Power and Associates survey, only 1 in 5 Americans are even interested in this technology, much less ready to invest in it. Needless to say, you haven't missed your window of opportunity. 

Think about how many amazing technologies you've watched soar to new heights while you kick yourself thinking, "I knew about that technology before everyone was talking about it, but I just sat on my hands." 

Don't let that happen again. This time, it should be your family telling you, "I can't believe you knew about and invested in that technology so early on."

That's why I hope you take just a few minutes to access the exclusive research our team of analysts has put together on this industry and the one stock positioned to capitalize on this major shift.

Click here to learn about this incredible technology before Buffett stops being scared and starts buying!

David Hanson owns shares of Berkshire Hathaway and American Express. The Motley Fool recommends and owns shares of Berkshire Hathaway, Google, and Coca-Cola.We Fools don't all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.

©1995-2014 The Motley Fool. All rights reserved. | Privacy/Legal Information