What happened

Shares of specialty vehicles maker Spartan Motors (NASDAQ:SHYF) are down a whopping 33.8% as of 2 p.m. EDT, which is just barely off their low of the day at down nearly 35%.

An earnings report is to blame.

This morning, Spartan reported GAAP profits of $0.15 a share and pro forma profits of $0.17 for fiscal Q3 2018. Whichever flavor of earnings you choose to focus on, however, these results fell far short of the $0.25 per share that Wall Street was looking for. This was despite the fact that quarterly sales of $226.2 million missed analyst expectations by barely $1 million.

A fire engine with its lights on driving down a city street.

Spartan makes emergency response vehicles like fire trucks, but it's Spartan stock that's having an emergency right now. Image source: Getty Images.

So what

Spartan did not willingly accept blame for the big earnings disappointment, arguing that "multiple external factors ... resulted in production and labor inefficiencies and shipment delays," and that these obstacles were both "significant" and "industrywide" -- not limited to Spartan. To the contrary, management pointed to its near-20% growth in sales year over year as evidence that the business remains strong, lamenting only that "gross profit margin decreased 350 basis points to 11.6% of sales."

Now what

Investors don't seem to be satisfied with that explanation, however, and are selling off Spartan shares in droves.

Forecasting, Spartan interim CFO Matt Long argues that "the underlying business fundamentals in each of our business segments remain strong," and that management is taking "proactive steps and cost reduction actions to help mitigate the unfavorable market conditions experienced in the third quarter."

However, Spartan says that while it expects to close out 2018 with sales between $790 million and $815 million, it will probably earn only $0.41 to $0.47 per share, down roughly 30% from its previous forecast of between $0.58 and $0.64 per share. That gives Spartan stock a current-year valuation of about 16.6 times earnings, which is not bad for a stock growing sales at nearly 20%. But that may not good enough unless Spartan can turn around its margins and get its profits growing again.