What happened

Shares of contract drug manufacturer Catalent (CTLT 0.03%) were up more than 14% Friday afternoon after the healthcare company announced updated guidance and said it was delaying its third-quarter report for a second time. The stock is down more than 18% this year.

So what

It seems counterintuitive that Catalent, after downgrading guidance and saying it was not able to prepare third-quarter earnings on time, would go up in price. But this is one of those situations where no news was bad news, and any kind of update was enough to allay investors' concerns.

The company's shares had already fallen when it announced on May 8 that its earnings report and guidance would not be on May 9, as originally scheduled. The stock had closed at $47.75 on May 5. The day the announcement came out, it closed at $35.46.

On a conference call today, Catalent said that it was trimming full-year revenue guidance to between $4.25 billion and $4.35 billion, down from previous guidance between $4.63 billion and $4.88 billion. That helped the stock bounce back because it gave some clarity to the situation. Catalent cited operational challenges for the reduced numbers.

The company also reduced its adjusted annual net income forecast to a range of $187 million to $228 million, down from the previous forecast of $567 million to $648 million. Catalent did say on the call that its customer supply situation was healthy and that the company continues to add new customers.

Management said that on May 16, it had received news from the New York Stock Exchange that the company wasn't in compliance because of the delayed earnings report, and it had six months to rectify the situation or face being delisted.

Now what

Where the stock goes from here depends on how bad the third-quarter numbers end up being. To some extent, the anticipated bad news is probably already priced into the stock. It's also unlikely Catalent would end up being delisted as it has a six-month window to come into compliance.