Linear Technology Hits New 52-Week Low on Cautious Forecast
shares are falling sharply today, after the company provided a forecast for the second quarter that was far below analyst expectations.
The company beat this past quarter's EPS estimates by 3 cents, on revenue that rose 10% to $310.4 million.
Management said that during the latter part of the September quarter and especially through early October, it had begun to see a decrease in new order bookings across all of the company's end-markets.
The new forecast for next quarter is for revenue to be down 10% to 20% from the first quarter. This would imply a revenue shortfall of potentially $70-$80 million.
We removed LLTC shares from our "Recommended" list back on August 22, when the stock was trading at $32.89. The company may end up testing the mid-to-high teens over the next few months, which would give it a valuation of 10-13 times 2009 estimates. At that point, a decent bottom may be finally priced in. The company has a 3.24% dividend yield, based on last night's closing stock price of $25.89.
Linear Technology is not recommended at this time, holding a Dividend.com Rating of 3.1 out of 5 stars.
Jones Apparel Hits 13-Year Lows on Earnings Warning
is down over 20% after the apparel maker lowered its profit outlook for the year amid the slowing economic environment.
The company, whose brands include Jones New York, Nine West, Anne Klein, and Gloria Vanderbilt, is lowering its full-year outlook to a range of 93 cents to 98 cents per share for the year -- well below previous expectations of $1.20 to $1.35 per share.
September was a brutal month for retailers as customers pulled in their spending even more while the financial turmoil spread.
We were fortunate to have removed the name from our "Recommended" list on Sept. 22 at the $19.31 level -- after recommending it from the $14 level in late July. We think the shares may be getting attractive at these levels again. However, we'd like to see shares stabilize a bit here, before jumping in. The company has a nice 4.14% dividend yield, based on last night's closing stock price of $13.52.
Jones Apparel is not recommended at this time, holding a Dividend.com Rating of 3.1 out of 5 stars.
State Street Misses EPS Target
reported its third-quarter earnings rose 33% due to higher fee revenue and a gain on its CitiStreet Sale.
Earnings came in 10 cents below the forecast earnings of $1.19 per share. The company saw its fee revenue increase 6% to $1.9 billion during the third quarter, as servicing fees and trading services revenue both picked up during the quarter. Overall, revenues rose 24% to $2.77 billion from $2.24 billion.
We have avoided the shares of State Street since our early June coverage began, when shares were trading at the $68 level. We are not excited by the stock at this point, and its low dividend yield of 1.62% -- based on last night's closing stock price of $56.69 -- is unattractive. We are cautiously maneuvering through the financial space looking for opportunities -- but State Street is not at the top of our list at this point.
State Street is not recommended at this time, holding a Dividend.com Rating of 3.2 out of 5 stars.
Callaway Golf Heads Into Rough With Profit Warning
is warning that its full-year profit will be lower than previously expected.
Management cited recessionary conditions as having a significant adverse effect on retailer and consumer confidence -- which exacerbated the normal end-of-season sales slowdown.
The company is now expecting a third-quarter loss per share would range between 12 cents to 14 cents -- worse than the one cent loss that had been previously expected. For the year, the company sees EPS of 93 cents to $1.02 per share -- which is below previous views of $1.08-$1.18.
We had removed shares of Callaway Golf from our "Recommended" list back on Oct. 6, when they were trading at $12.37. We were concerned then about consumers' spending habits, which have been quickly receding. We think there may be more downside ahead, as the stock does not have much technical support below the $10 level. We like the Callaway brand, and think lower prices will eventually present some solid long-term opportunities. The company has a 2.36% dividend yield -- based on last night's closing stock price of $11.87.
Callaway Golf is not recommended at this time, holding a Dividend.com Rating of 3.2 out of 5 stars.
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At the time of publication, the author had no positions in stocks mentioned, although positions may change at any time.
Tom Reese and Paul Rubillo are senior editors of Dividend.com. Visit Dividend.com for more dividend stock ratings, picks, news, and analysis for long-term and income-seeking investors.