
Polo Plunges on Asia Warning
NEW YORK (
) --
Polo Ralph Lauren
(RL) - Get Report
is plunging Wednesday despite better-than-expected third-quarter results, as it warns its Asian investments could suppress fourth-quarter earnings
During the third quarter, the company recorded a profit of $111.1 million, or $1.10 a share, a 5.5% increase from $105.3 million, or $1.05 a share, in the year prior. Analysts expected the company to earn $1 a share.
Revenue slipped to $1.24 billion from $1.25 billion, while same-store sales grew 6%.
Polo said it now expects 2010 revenue to decline by a low-single-digit rate. It previously forecast a mid-single-digit rate decline.
The company also said its Asian operations would hurt profit by 8 cents to 10 cents a share in the fourth quarter.
This guidance overshadowed what was, for the most part, a solid holiday quarter, Wall Street analyst Brian Sozzi said.
"We advised clients not to accumulate shares going in
to earnings, believing this amplified set of expectations, coupled with investments being made to support international growth, could create a letdown in fiscal 2010 guidance that pressured the stock," he wrote in a note.
Shares of Polo are tumbling 6% to $80.50 in pre-market trading.
-- Reported by Jeanine Poggi in New York.
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