Shares were trading for $21.08 apiece as of about 2:45 p.m., down 4.2% on the day after the company last night published its earnings, featuring a less than 1% increase in sales in Q4 and a deep swing to losses for the quarter and the full year.
Volcano posted losses of $20.5 million, or 38¢ per share, on sales of $103.3 million during the 3 months ended December 31. That compared with profits of $2.5 million, or 4¢ per diluted share, on sales of $102.5 million during the same period the previous year.
For the full year the company reported losses of $34.5 million, or 63¢ per share, on sales of $393.7 million. That compared with profits of $8 million, or 15¢ per diluted share, on sales of $381.9 million during 2012.
There was more bad news, as the company reported an anticipated 7.5% reduction in Japanese reimbursement for all of its disposable products, slated to hit in the 2nd quarter of this year. Volcano expects about 25% of its 2014 revenues to be in Japanese yen, and that total yen revenue will be down 3-3.5% this year.
Looking ahead, Volcano estimated that revenues for 2014 will be in the range of $413.0-$421.0 million and a net loss of 57-60¢ per share.
Volcano is also facing a challenge from activist investor fund Engaged Capital, which bought up a 5.1% stake last year and demanded changes including revisions to management compensation packages, a $200 million share buyback and calling for the company to resist acquiring any more companies to focus solely on "organic growth." Volcano later acceded to the share buyback demand, announcing a $200 million plan in December 2013.