Shares of LECG ( XPRT) plunged 27% Friday after the research services outfit slashed its 2006 profit projections.

LECG put fourth-quarter earnings at 14 cents to 15 cents a share, compared with its October forecast of 25 cents to 27 cents a share.

The company estimated fourth-quarter revenue of $88.5 million to $89.5 million, below its guidance of $90 million to $95 million.

Analysts polled by Thomson Financial had an average estimate for earnings of 26 cents a share and revenue of $91.5 million.

Shares of LECG recently were trading down $4.87 to $13.50.

The company is an "expert services" firm that provides independent expert testimony, studies and advisory services to companies, law firms and the government. LECG attributed the profit shortfall to factors such as an increased staff headcount, a reduction in revenue for estimated unrealizable accounts and higher-than-expected compensation and business development.

"We are very disappointed with the fourth quarter financial performance," said David Teece, LECG's chairman, in a statement. "In addition to carefully monitoring long-term investments, management is imposing tighter discipline on current spending in order to reduce general and administrative expenses as a percent of revenues."

For all of 2006, the company estimates earnings of 85 cents to 87 cents a share, with revenue of $353.5 million to $354.5 million. LECG's prior guidance called for a profit of 98 cents to $1 a share and revenue of $355 million to $360 million.

For 2007, LECG forecast earnings of $1.03 to $1.13 a share, with revenue of $405 million to $420 million. Analysts, on average, target earnings of $1.19 a share and revenue of $404.4 million.

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