FN
Beating the numbers wasn’t enough
Fabrinet came out swinging with Q1 earnings of $3.72 per share on $1.21 billion in revenue, both ahead of Wall Street’s expectations. Revenue was also way up from the same quarter last year, so on paper this was a pretty solid report.
The market still hit the brakes
But stocks don’t always care about the box score. FN slid 10.84% in extended trading, which tells you investors were looking past the beat and zeroing in on what comes next. In other words: nice quarter, but apparently not the kind that makes people sprint to buy more shares.
Guidance is the real plot twist
The company said it expects fourth-quarter adjusted EPS of $3.72 to $3.87, versus the Street’s $3.78 estimate, and revenue of $1.25 billion to $1.29 billion, versus expectations for $1.26 billion.
- EPS guidance basically brackets the consensus with only a little upside wiggle room
- Revenue guidance is solid, but not dramatically better than expected
- When a stock has already run hot, “pretty good” can suddenly feel like “not enough”
Big picture
Fabrinet is still doing the annoying-for-bears thing of growing nicely and beating estimates. But after this report, investors seem to be asking whether the stock had already priced in the good vibes — and then some.