Del Monte Falls Despite Indices' Gain
(Story updated with analyst view of earnings report and share price changes.)
NEW YORK ( TheStreet) -- Del Monte (DLM) shares extended their fall Friday after the company reduced its full-year sales growth target to 1% to 3% year over year.
Del Monte's previous sales growth guidance was in the range of 2% to 4%.
The company reaffirms its full-year earnings from continuing operations guidance of $1.38 to $1.42 a share.
Del Monte stock was tumbling by 2.4% to $12.52 Friday morning, in contrast to the major indices, which were higher after the government provided a labor market picture that was much less grim than expected.Stephens analyst Farha Aslam expected downside pressure on Del Monte stock to be limited by historically low valuation and the company's share repurchase program. "We believe as earnings visibility increases, so will the stock price." The day before, during late Thursday morning, Del Monte shares were falling by 1.2% to $13.01. Meanwhile, the major indices were flat to modestly higher as investors digested a slew of economic news including: the Labor Department's announcement that initial jobless claims declined last week, the National Association of Realtors announcement that its pending-home sales metric ticked up in July, and slightly higher factory orders and lower worker productivity. Del Monte lowered its sales forecast after reporting first-quarter net sales decline of 1.1% to $804.6 million, short of the average expectation of $829.47 million. Net sales for the quarter were especially weak in Del Monte's consumer products business, falling 6%. However, net sales at Del Monte's pet products business grew 3.6%.
Select the service that is right for you!COMPARE ALL SERVICES
Jim Cramer and Stephanie Link actively manage a real portfolio and reveal their money management tactics while giving advanced notice before every trade.
- $2.5+ million portfolio
- Large-cap and dividend focus
- Intraday trade alerts from Cramer
- Weekly roundups
Access the tool that DOMINATES the Russell 2000 and the S&P 500.
- Buy, hold, or sell recommendations for over 4,300 stocks
- Unlimited research reports on your favorite stocks
- A custom stock screener
- Upgrade/downgrade alerts
Jim Cramer's protege, David Peltier, identifies the best of breed dividend stocks that will pay a reliable AND significant income stream.
- Diversified model portfolio of dividend stocks
- Alerts when market news affect the portfolio
- Bi-weekly updates with exact steps to take - BUY, HOLD, SELL
All of Real Money, plus 15 more of Wall Street's sharpest minds delivering actionable trading ideas, a comprehensive look at the market, and fundamental and technical analysis.
- Real Money + Doug Kass Plus 15 more Wall Street Pros
- Intraday commentary & news
- Ultra-actionable trading ideas
Our options trading pros provide daily market commentary and over 100 monthly option trading ideas and strategies to help you become a well-seasoned trader.
- 100+ monthly options trading ideas
- Actionable options commentary & news
- Real-time trading community
- Options TV