West Marine on late Monday cut its earnings per share view for 2005 to 70 cents from 75 cents.
Analyst Laura Richardson said the lower 2005 outlook is due to both direct and indirect affects from Hurricane Katrina, as well as West Marine's additional spending related to its commitment to driving long-term sales growth. She cut her 33 cents third quarter earnings per share and 14 cents fourth quarter loss estimates to 16 cents in earnings per share and 21 cents of loss, respectively; she now sees 75 cents 2005 earnings per share, and $1.00 earnings per share for 2006. She thinks the company had a good start to the third quarter with positive comparables through most of August, but its sales dropped dramatically throughout the U.S. after Katrina. While she still believes in West Marine over the long term, her downgrades reflect caution in a very uncertain environment for consumer stocks.