hhgregg tumbles after lowering guidance

theflyonthewall.com

Electronics retailer hhgregg (HGG) is plunging after the company provided much weaker than expected first quarter guidance, and reduced its fiscal 2013 earnings per share guidance. The company predicted that it will report a first quarter EPS loss of 16c-17c, versus analysts' consensus estimate of a 4c EPS loss. hhgregg also expects its first quarter revenue to be significantly lower than expected. Moreover, the company reduced its fiscal 2013 EPS guidance to 90c-$1.05, from its previous outlook of $1.12-$1.27. Analysts' consensus estimate was $1.20. The retailer reduced its full-year comparable sales outlook to down 6% to down 4%, from its previous guidance of down 1% to up 1%. hhgregg blamed its guidance reduction primarily on weak sales of video devices. In a note to investors earlier today, Credit Suisse reacted to the company's announcement by reducing its target on the shares to $9 from $11. The firm noted that the company's appliance sales dropped 6.3% last quarter, compared with the same period in 2010. hhgregg may have been hurt by stepped-up advertising by large appliance retailers, the firm added. Credit Suisse maintained a Neutral rating on the stock, which sank $4.50, or 38.99%, to $7.04. Other electronics retailers also fell, with Best Buy (BBY) dropping 5.63% to $19.95 and CONN'S (CONN) giving back 5.71% to $15.28.

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