Personal Finance
KNL

Why Knoll Inc. Stock Fell Today

What happened

Shares of Knoll Inc. (NYSE: KNL) lost 14.2% today, after the furniture-and-textile maker posted a disappointing earnings report on Friday afternoon.

So what

Knoll's bottom-line result matched analyst expectations as adjusted profit per share improved from $0.43 a year ago to $0.44. However, revenue took a surprising fall, as sales slipped 4.2% to $292.9 million, well below the analyst consensus at $313.6 million. CEO Andrew Cogan said the company had a strong year overall but noted an industrywide slowdown in the fourth quarter. Still, he said he expected demand to return now that the uncertainty of the election season has passed.

Image source: Knoll.

Now what

Knoll didn't issue guidance for 2017 or the current quarter, so it's difficult to gauge management's upbeat declaration that demand was bouncing back. Even with today's drop, Knoll shares are up 27% over the past year, and the company's ability to drive modest profit growth in spite of falling revenue is encouraging, though a sales slide could also be a warning sign. Considering the company's modest valuation and its record of beating analyst estimates, I'd give management another quarter or two to show that the revenue decline was just a blip rather than a trend.

10 stocks we like better than Knoll

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 tripled the market.*

David and Tom just revealed what they believe are the 10 best stocks for investors to buy right now... and Knoll 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 February 6, 2017

Jeremy Bowman has no position in any stocks mentioned. The Motley Fool has no position in any of the stocks mentioned. 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.


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

In This Story

KNL

Other Topics

Stocks

The Motley Fool

Founded in 1993 in Alexandria, VA., by brothers David and Tom Gardner, The Motley Fool is a multimedia financial-services company dedicated to building the world's greatest investment community. Reaching millions of people each month through its website, books, newspaper column, radio show, television appearances, and subscription newsletter services, The Motley Fool champions shareholder values and advocates tirelessly for the individual investor. The company's name was taken from Shakespeare, whose wise fools both instructed and amused, and could speak the truth to the king -- without getting their heads lopped off.

Learn More