Office supply retailer Staples, Inc. (
) on Wednesday posted a sharp downturn in second quarter earnings
and lowered its full-year outlook, sending its shares plunging more
than 16% in premarket trading.
The Framingham, MA-base company reported second quarter net
income of $120.4 million, or 18 cents per share, compared with
$176.4 million, or 25 cents per share, in the year-ago period. Last
year's results included a favorable one-time tax benefit.
Revenue fell 5.5% from last year to $5.5 billion, partially hurt
by foreign currency fluctuations.
On average, Wall Street analysts expected a higher profit of 22
cents per share, on larger revenue of $5.72 billion.
Looking ahead, SPLS said it now expects full-year 2012 profits
to rise in the low single-digits from last year, with sales flat
from 2011. It had previously predicted a high single-digit gain in
profit and a low single-digit rise in sales.
Staples shares plunged $2.17, or -16%, in premarket trading
The Bottom Line
Shares of Staples (
) have a 3.27% dividend yield, based on last night's closing stock
price of $13.46. The stock has technical support in the $11 price
area. If the shares can firm up, we see overhead resistance around
the $14 price level.
Staples, Inc. (
) is not recommended at this time, holding a Dividend.com DARS™
Rating of 3.0 out of 5 stars.
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