Jefferies Reduces Price Target on Isle of Capri Casinos (ISLE) Following Q2 Miss

Jefferies is maintaining its Hold rating on shares of Isle of Capri Casinos (NASDAQ: ISLE) and is reducing its price target from $6 to $5.

For the second quarter, the company reported earnings and EBITDA below expectations while sales topped both the Street's and firms estimates. Jefferies highlights promotional expenditures also exceeded estimates.

Based on managements comments and current market trends, Jefferies is tweaking its Q3 revenue and EBITDA estimates from $236.1 million and $40.5 million to $232.3 million and $37.6 million.

For FY12 and FY13, the firm is adjusting its EPS estimates from $0.07 and $0.08 to ($0.10) and ($0.01). Core-EBITDA for FY12 and FY13 is now forecasted to be $165.4 million and $174.2 million, down from $174.8 million and $178.6 million.

An analyst at Jefferies comments, "ISLE’s 2QFY12 performance reflected the confluence of challenging consumer economic conditions, heightened competition and the after-effects of regional flooding. While we believe ISLE’s re-focused capital expenditure and marketing strategies should benefit the story in the long-term, we expect progress to materialize comparatively slowly given the company’s regional exposure."

For an analyst ratings summary and ratings history on Isle of Capri Casinos click here. For more ratings news on Isle of Capri Casinos click here.

Shares of Isle of Capri Casinos closed at $4.49 yesterday.

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