Office supply giant Staples, Inc. (
) on Thursday posted better-than expected first quarter earnings
results, but its relatively cautious second quarter and full-year
outlook sent its shares lower in premarket trading.
The Framingham, MA-based company reported first quarter net
income of $188.8 million, or 26 cents a share, compared with $143
million, or 20 cents per share, in the year-ago period. Excluding
special items, adjusted profit was 28 cents per share.
Sales rose more than 4% from last year, to $6.06 billion.
On average, Wall Street analysts expected a lower profit of 26
cents per share, on $6.03 billion in revenue.
Looking ahead, the company predicted second quarter profit to
range from 18 to 20 cents per share, and adjusted full-year results
of $1.25 to $1.33. Those estimates could miss those of analysts,
who currently expect 20 cents for the second quarter and $1.33 per
share for the year.
Staples shares fell 54 cents, or -2.5%, in premarket trading
The Bottom Line
We have avoided shares of Staples since our early June 2008
coverage began, when the stock was trading at $23.23. The company
has a dividend yield of 1.67%, based on last night's closing stock
price of $21.54. The stock has technical support in the $19 price
area. If the stock can continue to firm up, we see overhead
resistance around the all-time high levels of $24-$25 a share. We
would remain on the sidelines for now.
Staples, Inc. (
) is not recommended at this time, holding a Dividend.com DARS™
Rating of 3.4 out of 5 stars.
Be sure to visit our complete recommended list of the
Best Dividend Stocks
, as well as a detailed explanation of
our ratings system here
Created by Dividend.com