Why Shares of InnerWorkings, Inc. Popped 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 InnerWorkings  (NASDAQ: INWK  ) jumped as much as 20% in early trading today after reporting earnings yesterday afternoon. Shares settled in at a 4% gain late in the day.

So what: First-quarter revenue was up 18% to $206.6 million, and adjusted EBITDA was up 26% to $8.5 million. Earnings per share of $0.02 were above analysts' expectation of break-even results.  

Management also reaffirmed revenue guidance of $965 million to $1 billion and earnings guidance of $0.23-$0.27 per share, which were both at the high end of expectations.

Now what: Financial results are clearly improving quickly, and if management can continue to exceed expectations, the stock can certainly move higher. Forward estimates for $0.41 in earnings in 2015 mean investors are expecting growth to continue, and with shares already trading at 28 times the high end of this year's estimate, I'll wait for a better value. But if results continue to grow and beat expectations, there is upside for investors.

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