) shares fell Monday after the company reported first-quarter earnings per share of 44 cents, vs. 46 cents a year ago, as higher costs and expenses offset a 2% sales rise. The company sees EPS of 44 cents to 56 cents in the second-quarter. And it lowered its EPS outlook for fiscal year 2003 to $2.85 to $3.00.
USB Piper Jaffray downgraded the stock to outperform from strong buy. Analyst Brent Rystrom says first-quarter results were below assumptions, and the company continues to suffer from internal product availability problems. However, he believes ongoing profitability and a strong balance sheet should support the stock near current levels, even though the less than certain outlook causes him to downgrade to outperform rating.
Rystrom cut his $3.20 fiscal year 2003 (ending September) EPS estimate to $2.85, and his $500 million sales forecast to $460 million. He says this is a liquid, profitable company that is not going away. He kept his 12-month price target of $26.