What: Shares of supply chain management company Echo Global Logistics, Inc. (NASDAQ:ECHO) jumped 38% today after it reported earnings.
So what: Third-quarter revenue jumped 40% to $450 million and net revenue was up 50% to $87 million. Non-GAAP net income rose 41% to $10.2 million, or $0.34 per share, which was $0.02 ahead of estimates.
Now what: Revenue continues to be strong since Echo's acquisition of Command Transportation. But investors had become concerned that the growth wouldn't translate to similar growth on the bottom line. However, stronger-than-expected earnings despite headwinds like low oil prices give investors confidence that future growth should be strong as well.
The pop today seems to be overdone, but if shares settle lower in coming weeks, this is a stock that provides nice long-term growth potential for investors.
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.