Annie, are you OK? Are you OK, Annie? You've been hit by. You've been struck by ... criminally smooth expectations. (I may have just hit a new low in pop culture pilfering there. It was either Michael Jackson or Kyle MacLachlan's maniacal repetition of "How's Annie?" from the final scene of Twin Peaks. I chose the less creepy of the two.)
Annie's (BNNY) still has the cutest ticker symbol ever. But the organic food maker had an ugly day. Shares fell more than 9% at one point Thursday even though its first earnings report as a public company was solid. It was an insanely volatile day too as the one-day chart shows.
Of course, nobody should shed too many tears. Annie's is still up more than 80% from its offering price. This isn't Facebook (FB). But the stock is now trading below its first day closing price. And yes, Annie's is extremely expensive at 44 times fiscal 2013 earnings estimates. But I still think investors overreacted.
(Editor's note. The author of this blog post does not own shares of Annie's. But he feels personally responsible for much of the company's success based on the massive amounts of cheddar bunnies and macaroni & cheese consumed by Baby Buzz.)
The company beat expectations on sales and profits. The guidance looked tasty. What more can you ask for? This isn't a busted IPO where investors suddenly realize that the growth isn't as strong as they were expecting.
Anyway, Annie's may have to look out if shares keep falling. One of my followers on Twitter seems to be threatening a revolt.
Are you one of the 99% who prefer less expensive Kraft (KFT) mac & cheese over Annie's?
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