PeopleSupport (PSPT) Sinks On Poor Results and Guidance

Shares of PeopleSupport (NASDAQ: PSPT) are under significant pressure today as investor are reacting to poor results and guidance from the company. The stock is down 33% today.

PeopleSupport reported Q4 EPS of $0.81, which may not compare to the analyst estimate of $0.29. Revenues for the quarter were $35.9 million, below the consensus of $36.42 million.

For 2008, PeopleSupport sees revenues of $162-$170 million, versus the Street estimate of $184.4 million. The company sees FY08 EPS of $0.47-$0.58, versus the consensus of $0.75.

For Q1, PeopleSupport sees revenues of $35-$36 million, versus the Street estimate of $40.9 million. The company sees Q1 EPS of $0.11-$0.12, which may not compare to the consensus of $0.17.

In response to the results, Piper Jaffray lowered its rating on PeopleSupport to Neutral and cut its price target to $8.50. The firm cited collapsing Earthlink revenue, increased competition from multinational BPO providers, and a deteriorating macro environment.

PeopleSupport provides offshore business process outsourcing services. [LJ]

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