La-Z-Boy's stock hits 52-week low
Larry Thomas -- Furniture Today, June 21, 2004
Monroe, Mich. — Monroe, Mich.— La-Z-Boy has taken sharp punches from Wall Street in recent days as the bellwether furniture stock hit a 52-week low after the company announced disappointing sales and earnings projections for the current quarter.
The projections came on the heels of a less-than-stellar fiscal year ended April 24, which saw the company's sales slip below $2 billion.
At least two analysts downgraded their ratings on La-Z-Boy's stock, and several others reaffirmed ratings that, in effect, urge investors to be cautious in the short term.
"We believe the stock will remain in a trading range and thus we cannot warrant a buy rating," wrote Keith Hughes, an analyst at SunTrust Robinson Humphrey.
Hughes downgraded the stock from "buy" to "neutral," while Zack's Investment Research tagged it with a "strong sell" rating, the lowest on its rating scale.
"Investors may want to hold off on opening or deepening a position until analysts give its earnings estimates a lift," Zack's said.
Even before the ratings were lowered, La-Z-Boy's stock hit a 52-week low of $17.66 and was trading around $18 late last week.
On May 26, the day after the company announced its fourth-quarter earnings and first-quarter estimates, the stock fell more than 5% to $18.19 and has struggled to stay above $18 since then. It was trading at more than $23 per share as recently as mid-March.
Analysts said they were disappointed that the company was projecting earnings of 10 cents to 14 cents per share (excluding some one-time charges) for the current quarter, which ends in late July. In last year's first quarter, the company earned 18 cents per share, and the consensus among analysts had been 26 cents per share for the current quarter.
