Ahead Of The Bell: InnerWorkings Guidance

NEW YORK (AP) — Printing company InnerWorkings Inc.'s halving of its profit guidance for the year was not a "significant" surprise, said a William Blair analyst, and its shares are set for a fall.

Still, analyst Franco Turrinelli kept an "Outperform" rating on InnerWorkings stock in a note to investors Thursday, expecting the shares to drop on the revised outlook and making them more attractive to investors.

While he says he will probably adjust revenue and profit estimates to the low end of the company's guidance, he said he "continues to be bullish on the long-term prospects for the stock." InnerWorkings is adding customers, he said, and eventually, as the economy recovers those customers should ramp up spending.

On Wednesday, InnerWorkings said spending by existing customers had been dropping and cut its 2009 profit guidance in half to between 14 cents to 20 cents per share, and chopped $50 million off its full-year revenue outlook, to a range of $400 million to $425 million.

Analysts surveyed by Thomson Reuters expected profit of 28 cents per share on revenue of $443.2 million, on average.

Jefferies & Co. analyst Youssef Squali said, however, that InnerWorkings' new 2008 customers weren't generating nearly enough sales to offset the spending cuts by existing clients. He cut his earnings estimate for the year to 16 cents per share, at the lower end of InnerWorkings' new guidance, and shaved 50 cents off his price target to $3.50.

InnerWorkings stock closed at $5.66 Wednesday.