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 online digital image seller Shutterstock (SSTK 0.67%) jumped as much as 13% today, after the recent IPO reported strong quarterly earnings.
So what: Shutterstock, which provides over 22 million images for various publications and other outlets, said that the number of paid downloads it sold grew by 26%, and revenue per download also ticked up by 7%. Total revenue jumped 36%, to $42.3 million, and net income grew to $0.31 per share compared to $0.20 a year ago. Management also raised its revenue guidance for 2013 to $204 million to $208 million, but did not issue EPS guidance.
Now what: Considering that many IPOs often fade quickly after an initial pop, it's reassuring to see Shutterstock post such strong results in its first report as a publicly-traded company. Based on last quarter's EPS, the company is trading at a P/E less than 20, with considerable long-term growth prospects, as digital images become more valuable and more common, such as in marketing and business communications. Its fast-growing library should also help lock out competition. It's easy to see the stock moving higher in the near future.
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