What happened

Colfax Corporation (NYSE:CFX) saw its stock crushed in Tuesday trading, closing down 9% after the gas and fluid handling equipment maker reported Q4 2017 earnings. Despite what you might think, though, Colfax actually beat on earnings, reporting an adjusted profit of $0.45 per share when analysts had expected only $0.44 (although sales again fell short).

So what

That's the pro forma story, anyway. On a GAAP basis, Colfax did significantly worse last quarter. Actual net income per diluted share for the quarter came to only $0.10 per share, and the company reported a loss from continuing operations of $1.53 per share. To achieve a net profit on the bottom line, Colfax had to factor in $1.63 per share in earnings from discontinued operations, which included a "$308 million pre-tax gain resulting from the December 2017 sale of its Fluid Handling business to CIRCOR International."

Sales for the quarter climbed 8% year over year to $874 million.

For the year, Colfax ended up with $3.3 billion in sales, up 3% year over year, and a $1.22 per share GAAP profit -- up 17%.

A cartoon of a stock chart with a red line falling through the floor as two businessmen watch in dismay

Hold on a second. Isn't a stock supposed to go up after an earnings beat? Image source: Getty Images.

Now what

How much Colfax might earn in 2018 isn't entirely clear. Giving guidance for the year ahead, CEO Matthew Trerotola promised at least some "earnings growth," but again gave guidance only in the form of adjusted earnings, predicting $2 to $2.15 in pro forma profits this year.

Although that guidance range encompasses Wall Street's $2.14-per-share consensus estimate, at the midpoint it looks like it could fall short of estimates -- resulting in an earnings miss this year, and sapping investors' enthusiasm over last year's earnings beat.

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