Why JDS Uniphase Corp. Shares Plunged Today

Is JDS Uniphase's drop meaningful or just another movement?

May 1, 2014 at 2:10PM

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 JDS Uniphase Corp. (NASDAQ:VIAV) fell 15% early Thursday after the high-performance network specialist turned in weaker-than-expected fiscal third-quarter results.

So what: Adjusted quarterly revenue rose 3.1% year over year to $418 million, which translated to adjusted net income of $23.4 million, or $0.10 per share. Analysts, on average, were looking for adjusted earnings of $0.11 per share on sales of $431.73 million.

Now what: To their credit, JDS Uniphase CEO Tom Waechter did point out they stayed within their operating margin guidance range for the quarter, adding, "Our fiscal third quarter revenue was affected by later-than-expected carrier orders, but we are encouraged by a strong bookings performance and believe positive industry trends will drive improved top-line growth in our fiscal fourth quarter."

Even so, JDS Uniphase expects adjusted fourth-quarter revenue to be in the range of $425 million to $445 million, with adjusted earnings per share of $0.10 to $0.14. By contrast, analysts were modeling fiscal fourth-quarter earnings of $0.17 per share on sales of $459 million.

As a result, I can't blame the market for bidding down shares of JDS Uniphase today. Shares might look cheap right now trading around 13 times next year's expected earnings, but keep in mind those estimates are likely to fall as analysts have time to fully digest today's news. As a result, I think investors would be wise to let the dust settle for at least a few weeks before considering taking advantage of this plunge.

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A Financial Plan on an Index Card

Keeping it simple.

Aug 7, 2015 at 11:26AM

Two years ago, University of Chicago professor Harold Pollack wrote his entire financial plan on an index card.

It blew up. People loved the idea. Financial advice is often intentionally complicated. Obscurity lets advisors charge higher fees. But the most important parts are painfully simple. Here's how Pollack put it:

The card came out of chat I had regarding what I view as the financial industry's basic dilemma: The best investment advice fits on an index card. A commenter asked for the actual index card. Although I was originally speaking in metaphor, I grabbed a pen and one of my daughter's note cards, scribbled this out in maybe three minutes, snapped a picture with my iPhone, and the rest was history.

More advisors and investors caught onto the idea and started writing their own financial plans on a single index card.

I love the exercise, because it makes you think about what's important and forces you to be succinct.

So, here's my index-card financial plan:


Everything else is details. 

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