Greenberg: Picking at Country Style Cooking's Guidance
SAN DIEGO (TheStreet) -- Truth stranger than fiction department: Shares of Country Style Cooking (CCSC - Get Report), operators of a chain of popular restaurants in China, are sizzling after the company issued a press release today saying it "anticipates" fourth quarter revenue will "slightly" beat guidance.
However, by slightly beating guidance it will just meet full-year guidance. Here's the math: Prior Q4 guidance was $53.2 million to $54.8 million. Revenue for the first nine months were $166.383 million. Full-year guidance calls for $220.4 million to $221.1 million.
To get to that range, Q4 would have to be $54 million to $55.07, the mid-point of which is (drumroll!) $54.8 million -- the prior guidance that is being beaten.
In other words, Country Style Cooking's stock is up because the company, in effect, said it will merely meet expected annual guidance.
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As one friend says: "Suppose I say I will run two miles in 15 minutes. I run the first mile in eight minutes and announce that I will run the second mile in 7:30. But, I also maintain I will still run the two miles in 15 minutes. Obviously I have to run the second mile in seven minutes. How is it a 'beat' if I run the second mile in 7 minutes? I implied that I would and indeed had to to make the 15-minute mark.
"And, what's with the qualifier 'anticipate'? The quarter is two weeks over. How come they don't know?"
Because the whole thing is nuts, that's why.
--Written by Herb Greenberg in San Diego