Why CARBO Ceramics' Shares Popped

By Travis Hoium – Oct 25, 2012 at 12:27PM

NYSE: CRR

CARBO Ceramics

Is this meaningful or just another movement?

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 CARBO Ceramics (CRR) jumped 13% today after the company reported earnings.

So what: Third-quarter revenue fell 10% to $151.1 million, and earnings dropped by a third to $1.04 per share. The bottom line result was better than expectations because the company was better able to control costs.

Now what: Expectations had fallen so low that CARBO could beat estimates even though results are declining quickly. There is still an oversupply on the poppant market, and fracking is adjusting to low natural gas and oil prices. These challenges aren't abating any time soon, and in the meantime CARBO is too risky for this Fool to jump in.

Interested in more info on CARBO Ceramics? Add it to your watchlist by clicking here.

Fool contributor Travis Hoium has no positions in the stocks mentioned above. You can follow Travis on Twitter at @FlushDrawFool, check out his personal stock holdings or follow his CAPS picks at TMFFlushDraw.

The Motley Fool owns shares of CARBO Ceramics. 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.