Shares of AudioCodes (NASDAQ:AUDC) hissed and popped on Tuesday, falling as much as 17.2% before recovering to a 15% deficit at 2 p.m. EDT. The Israel-based vendor of voice networking and media processing technologies reported first-quarter results early in the morning, and the report was solid but not impressive enough to support AudioCodes' nosebleed valuation.
In the first quarter of 2019, AudioCodes saw revenue rise 10% year over year to $46.6 million. Earnings increased by 25%, landing at $0.10 per diluted share. The company continued its transformation into a pure intellectual-property licensing outfit, moving away from lower-margin products and services.
There wasn't anything terribly wrong with this report, but the stock was priced for absolute perfection and fell short of that elevated standard. Even now, after a quick 15% discount, AudioCodes investors are nursing a 132% return over the last 52 weeks. Compare and contrast that to the S&P 500 benchmark's 10% return over the same period, and it starts to look like some AudioCodes investors are cashing in some of their swift profits here.