NEW YORK (AP) ? Shares of Roundy's Inc. slumped 22 percent Friday after a ratings cut from Jefferies & Co., which believes that the terrible economy and growing competition will create more pressure for the Midwestern grocery.
THE SPARK: Analyst Scott Mushkin said promotions by competitors are pressuring both sales and profit margins at Roundy's. He lowered his rating on Roundy's to "hold" from "buy," and reduced his price target to $8, from $13.
THE BIG PICTURE: The Milwaukee company, which had its initial public offering of stock last year, owns five Midwestern supermarket brands: Pick'n Save, Copps, Rainbow, Metro Market and Mariano's. As with other traditional supermarkets, Roundy's is competing increasingly against big-box retailers, drug stores and dollar stores that are expanding their food sections.
On Thursday, the company reported second-quarter net income that fell short of expectations and it cut its outlook for the year. Roundy's now expects to earn 91 cents to $1.05 per share, down from the $1.11 to $1.22 per share it previously forecast.
Roundy's said that increasingly price-conscious consumers hurt results. It also conceded that advertising from competitors was greater than expected in several major markets.
For the three months ended July 2, the company said it earned $18.9 million, or 42 cents per share. That's compared with $17.7 million, or 58 cents per share, in the year-ago quarter, when there were fewer shares outstanding.
Analysts expected 43 cents per share, according to FactSet.
SHARE ACTION: Roundy's stock fell $2.25 to $7.98 in early trading.
Source: http://news.yahoo.com/roundys-shares-fall-analyst-downgrade-151718642--finance.html
chrissy teigen chia seeds embers shannon brown mike rowe shld 2012 sec football schedule
No comments:
Post a Comment
Note: Only a member of this blog may post a comment.