What: Shares of TriNet Group Inc plunged as much as 44% today after the company reported disappointing second-quarter earnings.
So what: Revenue of $122 million fell well short of the $137.6 million analysts expected from TriNet. Earnings of $0.14 per share was barely half of the $0.27-per-share bar Wall Street had set. This is the second quarter in a row the company has missed expectations by a wide margin.
Now what: Management had been investing in a growing sales force, which contributed to higher costs, but that investment hasn't yet affected the top line. What they attributed the earnings miss to was higher-than-expected medical costs. The company is exploring alternatives to increase visibility, but the market wasn't buying the excuses today. I like to see sales investments show traction before jumping in, but long-term I think this could be a nice discount for new investors.
The article Why Shares of TriNet Group Inc Plunged 44% Today originally appeared on Fool.com.
Travis Hoium has no position in any stocks mentioned. The Motley Fool has no position in any of the stocks mentioned. 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.
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