Valvoline (VVV)

[Cortina]

How on earth does a company suddenly become worth 22% less (in a few hours) , just because a set of results falls below expectations ??


confess to having bought some today ... I use their products and like them.

 

[NW-Bound]

Or perhaps a company was 22% overvalued, and the market readjusts the share price when the financials are reported?

I never follow Valvoline, but just look at the quarterly report out of curiosity. It missed the revenue estimate by almost 5%, and the earnings by almost 13%.

For the last 4 quarters, sales increases were modest, while earnings slightly decreased. P/E ratio after the 20% share price haircut is still 21, which is not at all undervalued.

 

[Lakewood90712]

Here is the earnings conference call transcript:

https://www.fool.com/earnings/call-...inc-vvv-q1-2019-earnings-conference-call.aspx

Surprises on the downside are not popular on wall street.

"A reconciliation of our adjusted results to amounts reported under GAAP and the discussion of management's use of non-GAAP measures was included in our earnings release. The non-GAAP information provided is used by our mpanies."anagement and may not be comparable to similar measures used by other companies."

Weasel words. My uninformed translation : "We have to clean up some creative accounting of the past".