Why Proto Labs Inc. Shares Are Soaring

By Markets Fool.com

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.

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What's happening: Shares ofProto Labs soared as much as 20% Thursday after the quick-turn manufacturerannounced record fourth-quarter and full-year 2014 earnings.

Why it's happening: In the fourth quarter, Proto Labs' revenue grew by 27.3% year over year to $56.1 million, translating to $0.39 in earnings per share, or $0.43 on an adjusted basis. These figures came in slightly above Wall Street expectations for Proto Labs to close out the fourth quarter with $54.6 million in revenue and $0.42 in adjusted earnings.

Across its manufacturing services, Proto Labs reported a 40% year-over-year increase in the number of unique product developers it served during the quarter, which suggests the company's rapid manufacturing services remain a compelling value proposition in the marketplace. Excluding the company's recent acquisition of 3D printing service bureauFineline, Proto Labs' legacy Firstcut CNC machining and Protomold injection molding manufacturing services served 20.3% more product developers during the quarter than they did in the year-ago period.

During the earnings conference call, Proto Labs issued its first-quarter 2015 revenue and earnings guidance, and the midpoints of its ranges came in above what the Street expected. For the first quarter, Proto Labs expects to generate $56.5 million to $59.5 million in revenue and to take home $0.43 to $0.47 per share in earnings. Prior to the guidance release, Wall Street analysts had expected Proto Labs to generate $57.8 million in revenue and $0.39 per share in earnings in the first quarter.

The article Why Proto Labs Inc. Shares Are Soaring originally appeared on Fool.com.

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Steve Heller owns shares of Proto Labs. The Motley Fool recommends and owns shares of Proto Labs. 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.