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Big 5 Deflates

Shares of the sporting goods retailers sink on soft guidance.

Big 5 Sporting Goods (BGFV) - Get Big 5 Sporting Goods Corporation Report deflated 6% Monday after the company matched third-quarter targets and offered soft fourth-quarter guidance.

The El Segundo, Calif., retailer made $7.8 million, or 34 cents a share, for the quarter ended Oct. 1, up from the year-ago $7.2 million, or 32 cents a share. Revenue rose 8% from a year ago to $223 million, as same-store sales rose 3.8%.

Analysts surveyed by Thomson Financial were looking for a 34-cent profit on sales of $223 million.

The company said it expects to make 34 to 40 cents a share for the fourth quarter, against a 40-cent Wall Street estimate. Fourth quarter earnings guidance, compared to the same period last year, reflects the unfavorable impact of the recording of co-op advertising cost reimbursements from vendors for fiscal 2006 earlier in the year, as well as a significantly lower benefit from inventory cost capitalization than the Company experienced in the fourth quarter of fiscal 2005.

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Shares fell $1.36 to $22.70.