Bruker’s Profits Increase, So Why the 20% Drop?

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By Douglas A. McIntyre Published
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by H.S. Ayoub
BioHealth Investor.com

I first featured Bruker BioSciences (BRKR) as a BHI Stock Pick back in March when the stock was trading at $9.42 a share. On Monday, the stock price ended trading at $11.51, near the 52-week high of $11.56.

The company released its first quarter 2007 numbers after the markets closed. Revenues increased by 16.5%, while operating income increasing 28.4% excluding acquisition related charges.

The stock then promptly lost more than 20% on Tuesday!

Insiders continue to buy shares, revenue and profits continue to increase year over year, so why the huge drop? Were analysts expecting more?

Back on April 2nd, Bear Stearns lowered its outlook on Bruker from Peer Perform to Under Perform. The stock dropped from $10.40 to a day low of about $9.60, before finishing the day back above $10, and reaching its 52-week high a couple of weeks later.

The lower outlook by Bear Stearns was a curious move since it was one of the firms that underwrote Bruker’s share offering back in February, at a price of $7.70 a share.

I still firmly believe in Bruker, and I personally hold shares in my portfolio. Untill I find a significant sign of trouble ahead I will continue to hold shares, but I will be sleeping with one eye open.

Bear Stearns knows something, and it is making me nervous.

Source: BioHealth Investor.com

Photo of Douglas A. McIntyre
About the Author Douglas A. McIntyre →

Douglas A. McIntyre is the co-founder, chief executive officer and editor in chief of 24/7 Wall St. and 24/7 Tempo. He has held these jobs since 2006.

McIntyre has written thousands of articles for 24/7 Wall St. He is an expert on corporate finance, the automotive industry, media companies and international finance. He has edited articles on national demographics, sports, personal income and travel.

His work has been quoted or mentioned in The New York Times, The Wall Street Journal, Los Angeles Times, The Washington Post, NBC News, Time, The New Yorker, HuffPost USA Today, Business Insider, Yahoo, AOL, MarketWatch, The Atlantic, Bloomberg, New York Post, Chicago Tribune, Forbes, The Guardian and many other major publications. McIntyre has been a guest on CNBC, the BBC and television and radio stations across the country.

A magna cum laude graduate of Harvard College, McIntyre also was president of The Harvard Advocate. Founded in 1866, the Advocate is the oldest college publication in the United States.

TheStreet.com, Comps.com and Edgar Online are some of the public companies for which McIntyre served on the board of directors. He was a Vicinity Corporation board member when the company was sold to Microsoft in 2002. He served on the audit committees of some of these companies.

McIntyre has been the CEO of FutureSource, a provider of trading terminals and news to commodities and futures traders. He was president of Switchboard, the online phone directory company. He served as chairman and CEO of On2 Technologies, the video compression company that provided video compression software for Adobe’s Flash. Google bought On2 in 2009.

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