Why Luxoft Holding Inc. Stock Dropped Today

What happened

Shares of Luxoft Holding Inc. (NYSE: LXFT) were down 14.1% as of 3:15 p.m. EST after the software development company announced solid fiscal second-quarter 2019 results, but followed with disappointing forward guidance.

On the former, Luxoft’s quarterly revenue climbed a modest 0.2% year over year, to $228.4 million, within its guidance provided in August for a range of $225 million to $230 million. That translated to adjusted net income of $25.1 million, or $0.74 per share, which was well above the $0.63 per share most investors were expecting.

Stock market prices with a red arrow line indicating losses


So what

“Our second quarter results demonstrate continued execution of our strategic priorities and transformation initiatives,” stated Luxoft CEO Dmitry Loschinin. “We continue to diversify our revenue and realign our focus and resources to the highest growth opportunities.”

To that end, Luxoft’s top two accounts comprised 30.2% of total revenue, marking a 5.2-percentage-point decline from the same year-ago period. Its top 10 accounts generated 54.3% of total sales, down from 57.7% a year ago.

Now what

Still, Luxoft anticipates revenue for the current fiscal third quarter in the range of $230 million to $235 million, well below Wall Street’s consensus estimates for closer to $250 million.

“While we expect some headwinds during the second half of the year,” added Loschinin, “we are confident that further execution of our strategy will strengthen our long-term growth profile and position us to deliver increasing shareholder returns.”

That’s fair enough. But for investors whose patience is wearing thin, it certainly doesn’t take the sting away from today’s declines or the fact that this is the fourth straight report  in which Luxoft’s outlook has left the market wanting more.

10 stocks we like better than Luxoft Holding

When investing geniuses David and Tom Gardner have a stock tip, it can pay to listen. After all, the newsletter they have run for over a decade, Motley Fool Stock Advisor , has quadrupled the market.*

David and Tom just revealed what they believe are the 10 best stocks for investors to buy right now… and Luxoft Holding wasn’t one of them! That’s right — they think these 10 stocks are even better buys.

Click here to learn about these picks!

*Stock Advisor returns as of November 14, 2018

Steve Symington has no position in any of the stocks mentioned. The Motley Fool recommends Luxoft Holding. The Motley Fool has a disclosure policy .

The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

Referenced Symbols: LXFT

Zeen is a next generation WordPress theme. It’s powerful, beautifully designed and comes with everything you need to engage your visitors and increase conversions.

Wealth Empire Newsletter
Register now for free updates and alerts

Subscribe By

Note: I have the ability to revoke this permission at any time and ask for the removal of my personal data collected by contacting us or simply clicking Unsubscribe.