Why Core Laboratories Stock Rose 5% and Fell 5% on the Same Day

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Shares of energy services company Core Laboratories (NYSE: CLB) opened the day with a 5% gain from the previous close. They then promptly fell to a decline of roughly 5%. By a little after 11 a.m. EST, however, the stock had reversed course and was back in the black. But it dipped lower again after that and was sitting with a decline of around 2.5% at 1 p.m. The culprit behind these wide swings was the company’s earnings, with a little help from energy prices mixed in.

First the good news, analysts had been expecting Core Laboratories to report earnings of $0.16 per share in the fourth quarter of 2020, but the company earned $0.18, taking out one-time items. So that was a nice beat, but you had to dig a little to understand that number because the company first highlighted its GAAP earnings of $0.31 per share. (On page 12 of the 13-page release, it provided a breakdown of the two numbers, outlining one-time items that needed to be pulled out.)

In the bullet points at the top of the release, meanwhile, it also noted that the sequential increase in adjusted earnings was more than 10% over the third quarter of 2020, but said nothing about the year-over-year change, which deeper in the report was shown to have been a decline of roughly 50%. Weak demand from exploration and production companies in the face of low oil prices clearly remains an ongoing problem even though the company did better than analysts had hoped.  

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