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 Horsehead Holding Corp. (NASDAQ: ZINC) fell as much as 10% today after updating its plant progress.
So what: On Friday, after the market closed, management announced that a new zinc plant in Mooresboro, North Carolina is about $40 million over budget and behind schedule. Planned EBITDA of $90 million to $110 million is unchanged, and production is expected this year -- but the delay is certainly bad news for investors.
Now what: With the increased costs, management is at least a little jittery about the company's financial position. They are "exploring additional sources of capital", which also means that a dilutive offering is on the table some time in the future. I don't think this is an opportunity to buy today, and would keep an eye on liquidity and construction progress in the future, as further delays change the company's value proposition.
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