Shares of protective equipment maker Alpha Pro Tech (NYSEMKT: APT) fell a hefty 11.5% in the first half hour of trading on Aug 4. They made back some of those losses by 11 a.m. EDT but were still down by around 9%. The news that moved the market was earnings, but when you see the actual results, there's a disconnect. At least, until you look at a slightly bigger picture.
Demand for Alpha Pro Tech's personal protective equipment skyrocketed year over year in the second quarter, with sales in the division jumping just over 280%. That was driven by the massive increase in demand for face masks and face shields that resulted from the spread of COVID-19. But even the company's building product division had a decent quarter, with sales up roughly 11%. All in, Alpha Pro Tech's top line increased 123% or so. Earnings, meanwhile, came in at $0.46 per share in the quarter, an increase of 475% compared with the same period in 2019. The company's cash balance increased to nearly $25 million from $6.5 million at the start of the year. That, coupled with a debt-free balance sheet, led management to give up a credit line that it hadn't tapped in a number of years. Basically, Alpha Pro Tech is a financially strong company that's hitting on all cylinders today.
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