USG Shares Jump After 1Q Results Beat Street

HARTFORD, Conn. (AP) — Shares of building products manufacturer USG Corp. surged Wednesday, a day after it posted a narrower-than-expected loss in the first quarter.

On Tuesday, USG posted a smaller quarterly loss of $42 million, or a loss of 42 cents per share, easily beating Wall Street's target of a 73-cent-per-share loss, according to analysts surveyed by Thomson Reuters.

Its revenue slid 26 percent to $864 million, and came up shy of Wall Street's forecast of $952.1 million.

"The good news in the quarter was that USG lowered its losses materially despite the poor sales trends," analyst John Baugh of Stifel Nicolaus & Co. said in a note to investors. "The bad news is that the company is still losing significant money and demand does not show any signs of improving."

He boosted his outlook for 2009 to a loss of $1.54 per share from prior expectations of a loss of $2.75 per share, assuming the company will see lower volume but higher margins.

Analysts surveyed by Thomson Reuters expect a loss of $2.55 per share for 2009.

William C. Foote, chairman and chief executive of the Chicago-based USG, said in a conference call Wednesday that first-quarter sales were down significantly compared with the same quarter last year — about 26 percent, or $300 million — though the company cut its operating loss by 30 percent.

Shares jumped 88 cents, or 7.4 percent, to $12.83 in afternoon trading.