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What: Shares of networking company Riverbed Technology (NASDAQ:RVBD) soared 13% today after its quarterly results and guidance nicely topped Wall Street expectations.
So what: Riverbed shares have slumped in recent weeks on concerns over soft IT spending, but a solid third quarter -- EPS of $0.28 on year-over-year revenue growth of 15% -- coupled with upbeat guidance for the current quarter naturally eases some of those worries. Demand for Riverbed's WAN optimization products seems to be holding up well even amid spending cuts from telecom customers, giving investors plenty of good vibes over its competitive position going forward.
Now what: Management now sees fourth-quarter adjusted EPS of $0.29 on revenue of $230 million to $236 million, versus the consensus of $0.28 and $232.9 million, respectively. "We're beginning to see more customers and Cloud service providers align with Riverbed as a strategic vendor as infrastructures evolve to take advantage of the benefits of hybrid cloud computing and virtual data centers," Chairman and CEO Jerry Kennelly said in a conference call. "It is my belief that Riverbed has never been better positioned to take advantage of these IT trends." With the stock still off about 25% from its 52-week highs even with today's rally, there might even be some room left to buy into those tailwinds.
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Fool contributor Brian Pacampara has no positions in the stocks mentioned above. The Motley Fool owns shares of Riverbed Technology. Motley Fool newsletter services recommend Riverbed Technology. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.