What's happening: Shares of Tile Shop Holdings (NASDAQ:TTS) fell as much as 11.7% early Tuesday, then partially recovered to trade down around 6.7% as of 12 p.m. after the specialty flooring retailer announced solid second-quarter results, but followed with disappointing guidance.

Why it's happening: Quarterly net sales rose 13.6% year over year to $75.7 million, thanks to a combination of revenue from new locations and 5.7% comparable-store sales growth. That translated to 20% growth in adjusted net income to $4.8 million, and a penny increase to earnings on a per-share basis to $0.09. Analysts, on average, were anticipating roughly the same earnings on slightly lower revenue of $73.7 million.

For the full year, Tile Shop also increased the lower end of its previous guidance by $5 million, resulting in a new 2015 revenue guidance range of $280 million to $290 million. Meanwhile, comps for the year are expected to be in the "mid single digits," compared to low-single-digit guidance before. And when all is said and done, adjusted earnings per share in 2015 should be $0.28 to $0.33, representing a penny-per-share increase from Tile Shop's previous outlook.

So what gives? First, keep in mind analysts were already anticipating full-year 2015 revenue of $285.6 million, and earnings of $0.31 per share. Though not by much, both estimates sit above the mid-points of Tile Shop's freshly raised guidance. In addition, Tile Shop surprised investors by saying it will only open seven to eight new stores this year, down from its initial range of eight to 10. By comparison, last year Tile Shop built 19 new locations.

It's no mystery our market is a forward-looking machine. And with shares already trading at a lofty 66 times trailing-12-month earnings, and 32 times next year's estimates, growth-hungry investors are undoubtedly concerned over the combination of conservative guidance and less aggressive location expansion. In the end, while these may be temporary concerns, it's no surprise the market is bidding down Tile Shop stock today.

Steve Symington has no position in any stocks mentioned. The Motley Fool recommends Tile Shop Holdings. The Motley Fool owns shares of Tile Shop Holdings. 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.