Ellie Mae Inc (ELLI) and More: Four Early Movers On Friday … Are Any Presenting Value?

Page 1 of 2

Earnings and earning-related news is the number one catalyst for stock movement. A strong quarter can dictate the direction of a stock for the following three months as can a bad quarter; in the past I have written in detail about such subjects, a domino effect following a strong or bad quarter. Therefore, I am looking and assessing four of the top movers following earnings on Friday.

Modest Growth Finally Takes its Toll

IPG Photonics Corporation (NASDAQ:IPGP) is trading lower in early trading by almost 8% after reporting earnings. The company’s stock had been trading near 52-week highs after a 25% three-month return, but after posting revenue growth of just 17% year-over-year (yoy) it’s very possible that investors will reassess their position.

This is a tech stock that is trading with a price/sales of 6.5 and at 21.05 times next year’s earnings. The company has operating margins of 38%, therefore it doesn’t appear expensive to the naked eye. However, the problem is that margins are near maxed and top-line growth is slowing.

As a result, after a top and bottom line miss, I’d avoid the stock for now, and would not pay more than a 4.0 price/sales multiple on this stock due to slowing growth.

Ellie Mae Inc (NYSE:ELLI)

Ellie Continues to Exhibit Perfection on All Levels

Ellie Mae Inc (NYSE:ELLI) is trading higher by 12% after reporting earnings that blew past expectations. This is a company that grew its revenue by 60% yoy, issued guidance above the consensus, and saw a 10% rise in users of its loan origination software. The company’s software is growing rapidly yet trades with a price/sales of slightly below 6.0.

Keep in mind, IPG Photonics, the company above, grew by just 17% and trades with a similar valuation. As a result, I definitely think Ellie Mae is a great potential investment, a company with room to grow in a mortgage industry that appears to be on the rise.

A Quarterly Beat is Not Enough to Counter Weak Guidance

Technology company LogMeIn Inc (NASDAQ:LOGM) continues to add to its one-year decline following earnings. The stock is currently trading lower by more than 25% after beating earnings expectations, due to issuing weak guidance. This is a stock that simply can not fall fast enough, a company that has continued to lower its guidance and is now growing by less than 15% year-over-year.

Obviously, the stock is not nearly as expensive as it was last year, now trading at just 4.37 times sales, yet investors must wonder if growth is in the company’s future. After a one-year loss of more than 55%, I still think I’d avoid this stock.

Qlik Breaks Out With Strong Earnings/Guidance

Qlik Technologies Inc (NASDAQ:QLIK) is trading higher by over 18% after the company’s earnings beat on both the top and bottom line. The company saw revenue growth of 27% over last year, saw 40% growth in North America, and provided excellent guidance.

Page 1 of 2
Comments
Insider Monkey Small Cap Strategy
Insider Monkey Small Cap Strategy

Insider Monkey beat the market by 52 percentage points in 24 months. Our beta is only 1.2 (don't click this link if beating the market isn't important to you).

Lists

Foods That Stain Your Teeth

Richest Doctors in the World

The Best Movie Sountracks Ever

The Highest Grossing Musicals on Broadway

The Most Successful Reality TV Stars

Cheapest Cities to Visit in the US

Most Expensive Summer Camps

Most Expensive Animals in the World

Most Expensive Specialty Crops in the World

Movies That Took Ages to Make

The Longest Hollywood Films Ever Made

Most Expensive Concert Stages

The Richest Bands of all Time

10 Most Corrupt Countries 2013 List

10 Countries with the Highest Quality of Life Index

Most Expensive Mattresses in the World

5 Smallest Countries by Land Area

The Ultimate Heartbreak Songs

Richest Teenagers in the World

10 Most Haunted Places in America

10 Best Places to Retire in Florida East Coast

Top 10 Places to See Before You Die

Top 8 Countries in the World Where Justice Prevails

10 Richest States in America

15 Wealthiest Countries in the World

Richest Singers in the World

Most Expensive Tasting Menu in New York City

Most Expensive Baby Items in the World

Most Expensive Hotel Suites in Vegas

Most Expensive Brunch in New York City

Most Expensive Beef Cuts in the World

25 Best Colleges to Get a Job

Top 10 US Supermarkets

The 25 Most Dangerous Cities in the World to Visit

Most Expensive Xbox Games

Top 11 Cities Where Billionaires Live

Top 10 Most Charitable Companies in America

Most Expensive Seafood in the World

The 10 Wildest Conspiracy Theories

The 10 Best Job Markets in the US

Top 10 Accounting Scandals of All Time

The 25 Biggest Cities in the World

Top 10 Best Paying Virtual Jobs

Most Expensive Leather Shoes in the World

Top 6 Things to Buy in March

The 10 Most Stressful Jobs in America – 2014 List

Top 10 Jobs for Introverted People

Top 10 Honeymoon Destinations in the World

Top 10 Highest Paying Jobs in the World

Most Expensive Day-Care in New York City

Subscribe

Enter your email:

Delivered by FeedBurner

X

Thanks! An email with instructions is sent to !

Your email already exists in our database. Click here to go to your subscriptions

Insider Monkey returned 47.6% in its first year! Wondering How?

Download a complete edition of our newsletter for free!