3Com (NASDAQ:COMS) shares dip on restatement of 1997 EPS
Reuters, Wednesday, July 30, 1997 at 15:13
NEW YORK, July 30 (Reuter) - Shares of 3Com Corp stock fell
on Wednesday after the company told analysts that it had
restated its fiscal 1997 earnings and that its current
operating margins were at the lower end of a targeted range.
Shares of 3Com fell 2-1/4 to 55-7/8 in active afternoon
trade.
Including the operations of recently-acquired U.S. Robotics
Corp, 3Com earned $1.81 a share in the fiscal 1997 year, which
ended in May, 3Com executives told analysts late Tuesday.
Many analysts had calculated the companies' combined
earnings at $1.85 per share for the year.
The company said differences in accounting methods between
the merging companies likely accounted for the shortfall.
3Com also said that its operating margins are currently
running near the lower end of a predicted range of 16 to 20
percent, they said.
Some analysts, however, shrugged off the news, noting that
the lower-than-expected figure did not reflect a change in the
company's performance but rather was just a change in fiscal
policy.
"It's a non-event," said Bill Rabin, an analyst at J.P.
Morgan Securities. "(The figures) have nothing to do with the
operations of the company. It's simply an accounting policy."
He suggested that the stock's slump today may be just
profittaking after recent gains. Shares of 3Com were trading
at about $50 a share in the first week of July and were at
about $30 early in May.
Copyright 1997, Reuters News Service |
