Why ChannelAdvisor Corp. Shares Crumbled 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 ChannelAdvisor Corp. (NYSE: ECOM  ) plunged nearly 13% Tuesday despite better-than-expected quarterly results from the cloud-based e-commerce specialist.

So what: Quarterly revenue grew 30% year over year to $19.3 million, which translated to an adjusted net loss of $8.7 million, or $0.36 per share. By comparison, ChannelAdvisor turned in a $0.16 per share net loss in the same year-ago period. Analysts, on average, were looking for a slightly wider $0.37 per share loss on sales of $18.97 million.

In addition, ChannelAdvisor sees second-quarter revenue between $19.8 million and $20.1 million, and full-year 2014 sales between $85 million and $86 million. The midpoint of both ranges is roughly in line with expectations.

Now what: The results were solid, but the market was obviously hoping for more, as analysts at both Baird and Deutsche Bank promptly lowered their respective per-share price targets on ChannelAdvisor to $40 and $32, without changing their "outperform" and "hold" ratings on the stock. It also didn't help that tech stocks in general got hammered today, with the Nasdaq Composite Index plunging almost 1.4%. 

However, it's still hard for me to get excited about ChannelAdvisor over the long term while it's still hemorrhaging so much red ink. For now, I personally prefer to simply observe ChannelAdvisor's progress from the sidelines.

Your credit card may soon be completely worthless
Speaking of e-commerce, did you know the plastic in your wallet is about to go the way of the typewriter, the VCR, and the 8-track tape player? When it does, a handful of investors could stand to get very rich. You can join them -- but you must act now. An eye-opening new presentation reveals the full story on why your credit card is about to be worthless -- and highlights one little-known company sitting at the epicenter of an earth-shaking movement that could hand early investors the kind of profits we haven't seen since the dot-com days. Click here to watch this stunning video.


Read/Post Comments (0) | Recommend This Article (3)

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.

Be the first one to comment on this article.

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: 2946502, ~/Articles/ArticleHandler.aspx, 10/23/2014 6:15:04 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...


Advertisement