Why Powell Industries (POWL) Stock Is Falling Today

NEW YORK (TheStreet) --Shares of Powell Industries Inc. (POWL) are declining by 8.96% to $45.27 in mid-afternoon trading on Friday, following Thursday's announcement that the company cut its full year 2014 operational guidance.

Powell Industries, a company that designs, develops, manufactures, and services custom engineered to order equipment and systems for the management and control of electrical energy processes, said it's now expecting earnings from continuing operations to be between $1.25 and $1.45 per share, compared to its previous guidance of $2.15 to $2.40 per share.

Analysts polled by Thomson Reuters are expecting Powell to post earnings of $2.17 per share for the year.

The company's revenue guidance was lowered to between $630 million and $640 million, from $650 million to $675 million.

Analysts are expecting revenue of $663.53 million for fiscal 2014.

Powell said higher costs and scheduling delays in the U.S business and higher costs in Canada caused it to reduce its earnings and revenue guidance for the year.

Separately, TheStreet Ratings team rates POWELL INDUSTRIES INC as a Hold with a ratings score of C+. TheStreet Ratings Team has this to say about their recommendation:

"We rate POWELL INDUSTRIES INC (POWL) a HOLD. The primary factors that have impacted our rating are mixed some indicating strength, some showing weaknesses, with little evidence to justify the expectation of either a positive or negative performance for this stock relative to most other stocks. The company's strengths can be seen in multiple areas, such as its largely solid financial position with reasonable debt levels by most measures and reasonable valuation levels. However, as a counter to these strengths, we also find weaknesses including unimpressive growth in net income, disappointing return on equity and poor profit margins."

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