Analyst John Baugh says Herman Miller's Q3 earnings warning supports his thesis that office-furniture industry business is softening due to a capital-spending slowdown, corporate-profit deterioration and higher energy costs. Baugh cut his $0.45 Q3 EPS estimate to $0.43, and also cut his $0.56 Q4 estimate to $0.55. In addition, Baugh reduced his $2.02 fiscal 2001 (May) EPS estimate to $1.99 and lowered his $2.30 fiscal 2002 estimate to $2.28. Baugh maintained his buy rating on the shares, and kept his $30 12-month price target. He says Herman Miller is still his top pick in the office and contract furniture space.