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 Pitney Bowes (NYSE:PBI) dropped 15% today after the company released earnings.
So what: First-quarter revenues dropped 4.4% to $1.17 billion, below the $1.21 billion estimate. Earnings per share came in a $0.42, which was also below the bar Wall Street had set at $0.46 per share.
Now what: To make matters worse, the company reduced its dividend to 18.75 cents per share. This is probably the right move with financials deteriorating but it's also a sign management doesn't see conditions picking up in the future. Pitney Bowes' stock looks cheap at seven times this year's estimates, but I'm afraid of a value trap and just don't see a lot of upside in the company's business.
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Motley Fool contributor Travis Hoium has no position in any stocks mentioned. 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.