What happened

Shares of ServiceMaster Global Holdings (NYSE:SERV) soared 10.8% on Thursday, defying the broader market's more than 4% plunge, after the pest-control leader released strong fourth-quarter 2019 results.

So what

Quarterly revenue grew 11% year over year to $507 million, translating to a 12% increase in adjusted net income to $30 million, or $0.22 per share. Analysts on average were only expecting earnings of $0.19 per share on revenue of $506.6 million.

Stock market chart on a dark blue background indicating gains.

Image source: Getty Images.

"Both the Terminix and ServiceMaster Brands segments delivered strong progress against our 2019 strategic initiatives," interim CEO Naren Gursahaney said. "As we announced in January, we are conducting a strategic review of our ServiceMaster Brands business, including a possible sale of the business."

Now what

For the full year of 2020, ServiceMaster now expects revenue from continuing operations of $1.98 billion to $2 billion (which excludes the ServiceMaster Brands), good for growth between 9% and 10% from 2019 and above the estimates for an increase of closer to 7.5%. That range assumes roughly $60 million in revenue from Terminix acquisitions closed before today, organic revenue growth of 3% to 4%, and roughly $75 million in sales from European pest operations.

In the end, between ServiceMaster's solid end to 2019, its value-generating efforts to potentially divest its namesake brands, and that encouraging outlook, bullish investors had every reason to bid up this consumer discretionary stock in response.

This article represents the opinion of the writer, who may disagree with the “official” recommendation position of a Motley Fool premium advisory service. We’re motley! Questioning an investing thesis -- even one of our own -- helps us all think critically about investing and make decisions that help us become smarter, happier, and richer.