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 little-known Ixia
So what: Ixia posted $0.18 per share in adjusted profits on $77.8 million in revenue, a record for the company and a 39% increase over last year’s Q4. Analysts were expecting $0.17 and $74.8 million, respectively. Clearly, this is a growth story in the making.
Now what: But is it a sustainable story, one in which tech investors should take interest? There’s room for debate. On the one hand, Ixia’s technology is useful for testing the equipment behind the new generation of wireless LTE networks now being built by the likes of AT&T
On the other hand, Ixia suffered three years of nonexistent growth from 2007 to 2009. Which is the real Ixia? I suspect a lot of that depends on the spending habits of LTE network builders. Rather than buy Ixia shares at current prices, I’d wait to see whether the LTE builders keep spending.
Fool contributor Tim Beyers is a member of the Motley Fool Rule Breakers stock-picking team. He didn’t own shares in any of the companies mentioned in this article at the time of publication. Check out Tim's portfolio holdings and Foolish writings, or connect with him on Twitter as @milehighfool. You can also get his insights delivered directly to your RSS reader. 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 is also on Twitter as @TheMotleyFool. Its disclosure policy is at least 10% better than other disclosure policies.
More from The Motley Fool
3 Dividend Stocks Perfect for Retirees
Microsoft, Home Depot, and AT&T are dividend-paying stocks that could help make your retirement dreams a reality.
Free TV on Your Mobile Phone? What's the Deal?
The battle for mobile supremacy is good for consumers, but may indicate telecom growth is finished.
3 Dividend Stocks That Cut Bigger Checks Than Verizon
Ford Motor Company, Cedar Fair, and Cheniere Energy Partners all have larger payouts than Verizon Communications, but that's not the only reason to consider these stocks for your portfolio.