Why NCR Corporation Shares Tumbled Today

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 NCR Corporation  (NYSE: NCR  ) fell more than 10% in Wednesday's early trading, then partially recovered to close down 6% after the company turned in solid first-quarter results, but lowered its full-year 2014 guidance.

So what: Quarterly revenue increased 8% to $1.52 billion, including 45% growth in software-related revenue to $395 million. This translated to adjusted earnings of $0.50 per diluted share. Analysts, on average, were only looking for earnings of $0.48 per share on sales of $1.52 billion.

However, NCR followed by reducing its 2014 top-line guidance, and now sees full-year revenue in the range of $6.75 billion to $6.85 billion, or year-over-year growth of roughly 10% to 12%. NCR had previously told investors to expects sales to increase 12% to 14%. Curiously, 2014 adjusted earnings per share are still expected to be roughly $3.00 to $3.10 -- though CEO Bill Nuti admitted they will likely "be at the lower end of this range based on what we are seeing today."

Analysts, for their part, were modeling 2014 earnings of $3.05 per share, but on revenue at the high end of NCR's expected range, at $6.85 billion.

Now what: Nuti blamed a "challenging market in Retail Solutions" for the guidance shortfall, which isn't ideal, but also doesn't mean NCR is a broken business. With shares currently trading at just 10 times the low end of NCR's expected 2014 earnings range, I think today's pullback could represent an attractive entry point for patient long-term investors.

These six stock picks are poised for incredible growth
But if NCR doesn't whet your appetite for growth, you're in luck! They said it couldn't be done. But David Gardner has proved them 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 six carefully chosen picks for ultimate growth instantly, because he's making this premium report free for you today. Click here now for access.

Read/Post Comments (1) | Recommend This Article (1)

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 May 01, 2014, at 1:45 PM, MrToad2 wrote:

    My thesis on NCR is that they should benefit greatly from major upgrades of both retail Point of Sale, POS, & ATM's to EMV standards...with the Target debacle and 95% of ATM's running expired Win XP. These themes have been mentioned in Fool articles. Yet price action, their guidance, comments on "challenging market in Retail Solutions," and no mention of EMV in the recent conference call disconfirm this thesis.

Add your comment.

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: 2938006, ~/Articles/ArticleHandler.aspx, 8/30/2015 4:12:38 AM

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...

Steve Symington

Technology and consumer goods specialist for the Fool. Steve looks for responsible businesses which positively shape our lives. Then, he invests accordingly. Enjoy his work? Connect with him on Twitter & Facebook so you don't miss a thing.

Today's Market

updated 1 day ago Sponsored by:
DOW 16,643.01 -11.76 -0.07%
S&P 500 1,988.87 1.21 0.06%
NASD 4,828.33 15.62 0.32%

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

8/28/2015 4:02 PM
NCR $25.16 Up +0.18 +0.72%
NCR CAPS Rating: ****