This looks like good news for us who bought today!
CHICAGO, Nov 19 (Reuters) - Shares of BMC Corp tumbled 44
percent in heavy trading after the company estimated lower than
expected fourth quarter earnings based on a shortfall in its
television masks business.
Steve Jacobs, analyst at Dain Bosworth, was surprised by
the lower expectations. "I thought that if they would have
stumbled, it would have happened in the third quarter. I kind
of thought we were home free," he said.
Earlier today, BMC estimated fourth quarter earnings in a
range of $0.22 to $0.26 a share, below analysts' estimates of
$0.54 to $0.55. The company, which makes aperture masks for
color picture tubes in televisions and computers, said its
outlook was based on an expected sales shortfall in its
television masks business.
BMC also said it believes the TV sales slowdown, which it
said was caused by a "number of independent factors," will be
temporary.
This year has been a transition year for the company, which
increased its capacity by 33 percent most in the third quarter.
"Management's attention was temporarily focused on bringing
capacity up and probably a little inattentive to the core
business," Jacobs said.
Jacobs maintains a strong buy recommendation on the stock
based on strong fundamentals. "Their basic businesses are still
very positive. The world is moving towards large TVs and
monitor screens," he said.
"The glitches that they suffered (in TV) can be rectifed
within this quarter, the monitor business would be a little bit
longer but clearly should be up to speed by the end of the
first quarter," he said.
Shares of BMC fell 13-9/16 to 17-5/16 on turnover of more
than 3.5 million shares. Jacobs expects the stock to move back
to the 22 to 23 range shortly.
REUTERS
Rtr 16:17 11-19-97
Copyright 1997, Reuters News Service |
