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 solar installer SolarCity (NASDAQ:SCTY.DL) fell 14% today after reporting earnings.
So what: During the fourth quarter, revenue grew 22%, to $25.2 million, but fell well short of the $38.3 million analysts expected. The company also reported a loss of $1.10 per share, which far exceeded the $0.43 loss that Wall Street expected.
Now what: The big question for SolarCity is; When will it make a profit? This quarter didn't ease any fears investors had and, with shares trading at double the IPO price, expectations have gone up in recent months. I'd take a "wait and see" approach with SolarCity, because there's no indication it can control operating costs and grow sales enough to generate a profit for shareholders.
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Fool contributor Travis Hoium has no position in any stocks mentioned. You can follow Travis on Twitter at @FlushDrawFool, check out his personal stock holdings or follow his CAPS picks at TMFFlushDraw. The Motley Fool has no position in any of the stocks mentioned. 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.