Why CalAmp Corp. Stock Dropped 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 wireless communications technologist CalAmp (NASDAQ: CAMP  ) dropped 13% today after its current-quarter outlook disappointed Wall Street.

So what: CalAmp's Q1 results were particularly strong -- earnings spiked 59% to $2.7 million on a revenue increase of 10% -- but downbeat guidance for Q2 is causing Mr. Market to quickly recalibrate his growth estimates. Slumping demand at CalAmp's satellite business continues to offset much of the strength at its wireless datacom segment, raising plenty of concern among analysts over its near-term profitability.

Now what: Management now expects Q2 EPS of $0.17-$0.21 on revenue of $57 million-$61 million, below the consensus of $0.22 and $62.5 million. "[W]e anticipate the second half of fiscal 2015 will be significantly stronger than the first half of the year, with Wireless Datacom revenue growth expected to accelerate as we move through the last two quarters of the year driven by the emerging auto insurance telematics and heavy equipment markets," said CEO Michael Burdiek. "However, this momentum is expected to be partially offset by the full year outlook for our Satellite business, which is now anticipated to be below earlier projections." Of course, with CalAmp shares now off about 45% from their 52-week highs and trading a forward P/E in the low-teens, much of that weakness might already be baked into the valuation. 

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Comments from our Foolish Readers

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  • Report this Comment On July 02, 2014, at 2:55 PM, EllisEconomics wrote:

    Ok, 31 working days ago I took over a family portfolio. I was doing Ok... in fact happy ... then I decided to get some small help ... trying two picks from two people and 4 from one .... my cost of these services is $140.00 so no big deal... here is the score...

    Charles Payne Big Loss on VLO

    Motley Fools Big loss on Camp and small gain on SWIR

    Cramer three up but no action down some [OLBK]

    Where are the experts ? I am, on my picks, up 22% in the same time ... Thanks for the note not much help after the fact ... but still a good show....

  • Report this Comment On July 02, 2014, at 8:28 PM, phoenixseangels wrote:


    motley fool is a 3-5 year play, 31 days in is not enough time. i hold camp and swir also. looking forward to both doing very well for a long time.

  • Report this Comment On July 07, 2014, at 3:45 PM, rmiers1 wrote:

    not all fool stocks work, but among them are some hear more about the!'s a business

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Brian Pacampara

I take a look at big 10% moves, as well as stock-shaking analyst calls, on a daily basis for The Fool. While I don't believe in active trading, closely monitoring Mr. Market's mood swings can help identify long-term opportunities.

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Related Tickers

9/3/2015 4:00 PM
CAMP $16.04 Down -0.05 -0.31%
CalAmp CAPS Rating: *****