CompoSecure (CMPO) reported its third-quarter 2024 earnings results on November 8, and the company's stock plummeted by over 19% in response to a staggering pretax loss that overshadowed its better-than-expected revenue and adjusted EBITDA performance.

For the third quarter, CompoSecure reported net sales of $107.135 million, beating analysts' estimates of $105.5 million. The company's adjusted EBITDA of $40 million also surpassed the expected $38.5 million. However, the market's focus was firmly on the company's massive pretax loss of $84.845 million, which missed analysts' estimates of a $29.2 million profit.

The significant divergence between the company's actual pretax loss and analysts' profit expectations led to a sharp sell-off in the stock. Analysts had expected CompoSecure to report an adjusted earnings per share (EPS) of $0.29 for the quarter, but the company fell short with an adjusted EPS of $0.27. CompoSecure also reported a net loss of $85.474 million for the quarter, further compounding investor concerns.