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 high-tech materials company GrafTech International Ltd (GTI.DL) jumped as much as 14% today after it reported earnings.
So what: First-quarter revenue fell 26% to $207 million and net loss grew from $12 million to $56 million, or $0.41 per share. Adjusted loss, which pulls out one-time items, was $0.10 per share, $0.05 worse than estimates.
Now what: Usually missing estimates will send a stock sharply lower, but along with earnings GrafTech announced a $150 million preferred equity investment by Brookfield Asset Management. It also revealed that Brookfield plans to announce a tender offer for shares of GrafTech International stock for $5.05 per share.
These two actions more than earnings are driving shares higher today. Clearly, the managers at Brookfield are bullish on the company's future, and with a potential offer for shares at $5.05 per share on the table today, I don't see a reason to sell. However, earnings aren't strong enough for me to be very bullish on the stock, either.
