Although we don't believe in timing the market or panicking over market movements, we do like to keep an eye on big changes -- just in case they're material to our investing thesis.
What: Shares of personal-finance website Bankrate
So what: It's a little hard to know what to do with investors' reaction to Bankrate's first-quarter numbers. For the quarter, revenue jumped 26% from the prior year, while net income doubled. On an adjusted basis, earnings per share climbed 38% year over year to $0.18. To be sure, that $0.18 tally missed analysts' estimates, but only by $0.01.
Now what: When a company's shares dive like this on earnings news, it's very often a matter of poor forward guidance. But Bankrate's full-year view shouldn't have shocked shareholders -- the projection of revenue growth "in the mid-20% range" and "EBITDA margins in the lower 30% range" was the same as what the company offered back in February. So what's the story, then? It could be simply that with shares currently -- that is, after today's drop -- trading at 24 times expected 2012 earnings, investors thought they needed a bigger, better quarter and perhaps a boost to full-year guidance.
In that light, there may be reason for some chagrin, but Bankrate's first quarter still looked pretty solid.
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Fool contributor Matt Koppenheffer has nofinancial interest in any of the companies mentioned. You can check out what Matt is keeping an eye on by visiting his CAPS portfolio, or you can follow Matt on Twitter, @KoppTheFool, or on Facebook. The Fool's disclosure policy prefers dividends over a sharp stick in the eye.