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) jumped 10% today after reporting earnings.
So what: First-quarter revenue was down 6.9% to $110.1 million and fell slightly below the $110.9 million estimate. Net income fell 75% to $700,000, but on an adjusted basis the $0.02 per share profit was six cents better than estimates.
Now what: Horsehead is being helped by low expectations more than great performance, but with challenges in the first quarter, that's about the best investors could have expected. The start-up of the Mooresboro plant is really key for the company, and if it performs as expected, management sees $90-$100 million of addition EBITDA from the facility. Startups often cost more than expected, so I'd take a cautious approach, but we should be able to get a feel for the operational direction of the plant by the end of the year.
