Jefferies Downgrades WMS Industries (WMS) to Hold, Very Weak Guidance
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Price: $161.34 +0.64%
Rating Summary:
10 Buy, 12 Hold, 2 Sell
Rating Trend:
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Today's Overall Ratings:
Up: 11 | Down: 12 | New: 13
Rating Summary:
10 Buy, 12 Hold, 2 Sell
Rating Trend:
Up
Today's Overall Ratings:
Up: 11 | Down: 12 | New: 13
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Jefferies downgraded shares of WMS Industries (NYSE: WMS) to a Hold rating from its previous rating of Buy and is lowering its price target from $54 to $36.
The downgrade comes following the company's pre-announced Q3 results. During the conference WMS lowered its FY11 outlook and its FY12 outlook well below the streets expectations. The company's Q3 EPS range was released at $0.40-$0.42 while its FY11 revenue guidance range is $790-$800 million. Its FY12 revenue range is now $810-$850 million. This is partially reflected by WMS's margin estimate, which is down 100-200 bps.
The firm is lowering its Q3 EPS estimate from $0.53 to $0.41 and its FY11 EPS and revenue estimates from $2.02 and $278.4 million to $1.74 and $253.2 million. Jefferies also lowered its FY12 estimates from $2.45 and $321.8 million to $2.08 and $287.7 million.
Management cited that challenges in the commercialization of new products and regulatory approvals caused them to release such low guidance.
Jefferies comments that, "these challenges have clearly accelerated through the quarter, as evidenced by the company's repurchase of $30 million of stock. Prior commentary reflected a meaningful increase in profitability in 2HFY11 and into FY12." The firm notes that these challenges are company specific.
For more ratings news on WMS Industries click here and for the rating history of WMS Industries click here.
Shares of WMS Industries closed at $36.22 yesterday.
The downgrade comes following the company's pre-announced Q3 results. During the conference WMS lowered its FY11 outlook and its FY12 outlook well below the streets expectations. The company's Q3 EPS range was released at $0.40-$0.42 while its FY11 revenue guidance range is $790-$800 million. Its FY12 revenue range is now $810-$850 million. This is partially reflected by WMS's margin estimate, which is down 100-200 bps.
The firm is lowering its Q3 EPS estimate from $0.53 to $0.41 and its FY11 EPS and revenue estimates from $2.02 and $278.4 million to $1.74 and $253.2 million. Jefferies also lowered its FY12 estimates from $2.45 and $321.8 million to $2.08 and $287.7 million.
Management cited that challenges in the commercialization of new products and regulatory approvals caused them to release such low guidance.
Jefferies comments that, "these challenges have clearly accelerated through the quarter, as evidenced by the company's repurchase of $30 million of stock. Prior commentary reflected a meaningful increase in profitability in 2HFY11 and into FY12." The firm notes that these challenges are company specific.
For more ratings news on WMS Industries click here and for the rating history of WMS Industries click here.
Shares of WMS Industries closed at $36.22 yesterday.
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