Please ensure Javascript is enabled for purposes of website accessibility

Why Westell Technologies, Inc. Shares Jumped (Again)

By Steve Symington - Feb 4, 2014 at 9:04PM

You’re reading a free article with opinions that may differ from The Motley Fool’s Premium Investing Services. Become a Motley Fool member today to get instant access to our top analyst recommendations, in-depth research, investing resources, and more. Learn More

Is Westell's jump 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 Westell Technologies, (WSTL) jumped more than 10% during Tuesday's intraday trading, then settled to close up around 5% after the company beat expectations with its latest quarterly report.

So what: Remember, shares of Westell also jumped last Thursday after analysts at Cowen listed the company in a new research report as a potential beneficiary of higher-than-expected 2014 capital expenditures budgets reported by several of Westell's large communications customers.

Curiously enough, Westell's quarterly revenue came in at $25.2 million, or short of expectations for sales of $26.75 million. However, that translated to adjusted net income of $0.07 per share, compared with estimates that called for a breakeven quarter. 

Now what: Westell doesn't typically provide forward guidance, so it's hard to blame analysts for once again missing the mark. But hey, at least they were somewhere in the neighborhood this time, especially considering last quarter's blowout numbers resulted in the stock jumping by as much as 40% in a single day.

Nonetheless, while the results were solid, I still prefer more visibility from management in personally selecting my long-term investments. For now, and given the risk of being on the wrong end of such volatility going forward, that's why I have no qualms steering clear of Westell stock.

Steve Symington and The Motley Fool have no position in any of the stocks mentioned. Try any of our Foolish newsletter services free for 30 days. We Fools don't 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.

Invest Smarter with The Motley Fool

Join Over 1 Million Premium Members Receiving…

  • New Stock Picks Each Month
  • Detailed Analysis of Companies
  • Model Portfolios
  • Live Streaming During Market Hours
  • And Much More
Get Started Now

Stocks Mentioned

Westell Technologies, Inc. Stock Quote
Westell Technologies, Inc.
WSTL

*Average returns of all recommendations since inception. Cost basis and return based on previous market day close.

Related Articles

Motley Fool Returns

Motley Fool Stock Advisor

Market-beating stocks from our award-winning analyst team.

Stock Advisor Returns
377%
 
S&P 500 Returns
123%

Calculated by average return of all stock recommendations since inception of the Stock Advisor service in February of 2002. Returns as of 08/09/2022.

Discounted offers are only available to new members. Stock Advisor list price is $199 per year.

Premium Investing Services

Invest better with The Motley Fool. Get stock recommendations, portfolio guidance, and more from The Motley Fool's premium services.