Guidance Hammers Stanley

Shares fall 7%.
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Stanley Works

(SWK) - Get Report

fell 7% Wednesday after the toolmaker cut sales growth guidance.

The company earned $90.5 million, or $1.09 a share, in the third quarter, compared with $76.9 million or 90 cents a share, a year ago.

Third-quarter revenue rose 21.3% from a year ago to $1.01 billion. Operating income rose 16.53% from a year ago to $145.9 million and operating margin decreased 59 basis points to 14.41%.

By segment, third-quarter operating profit for consumer products segment rose 12.28% from a year ago to $64 million and in industrial tools it increased 39.6% to $41.6 million. Security solutions division's profit increased 5% to $40.3 million. The company expects to earn about $3.45 a share, an increase of 8% over $3.18 earned in 2005 from continuing operations. Analysts polled by Thomson First Call were expecting earnings of $3.53 a share.

Management also updated estimates for full year 2006, lowering expectations for total sales growth to 22-23% from 24-26% and organic sales growth to 2-3% from 3-5%

Shares fell $3.72 to $47.63.

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