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 oil and gas industry service company Basic Energy Services, Inc (NYSE:BAS) fell as much as 12% after reporting earnings.
So what: Revenue was up 9%, to $359.7, and swung from a $4.2 million loss a year ago to a $2.4 million, or $0.06 per share, profit. Revenue topped the $357.4 million estimate from Wall Street, and adjusted earnings of $0.13, which exclude one-time items, were $0.04 better than estimates. The drop was strange given the solid results, but investors had clearly set their expectations even higher.
Now what: Demand for Basic Energy Services was up across the board, as oil and gas prices remained relatively high. The Permian Basin continues to be a strong point and, with drilling expanding there, it should be for the foreseeable future. Right now, the value is what's concerning because the company is barely back to profitability; but if momentum picks up, this could be a good value for investors.
Travis Hoium has no position in any stocks mentioned. The Motley Fool has no position in any of the stocks mentioned. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.