Easy Button Out of Reach for Staples
Office retailer scales back guidance.
Sales increased 3%, while North American comp-store sales dropped some 7%. A quick look at last year's second quarter results reveals that North American comps were down 2% in 2007. I think the comparison shows how much the company is indeed struggling.
This is in contrast with the guidance Staples offered in May, "which called for mid single-digit sales growth and high single-digit earnings per share growth for the full year."
It's more than a little surprising that the sell side didn't see this coming, given the fact that Staples hardly ripped the cover off the ball in its first quarter. In addition, its rival Office Depot (ODP) turned in a small loss and reported some lousy North American sales results. And Illinois-based Office Max (OMX) saw red in its second quarter.
And yet, when I look at the average estimate for the year, I see that it's only ticked down a penny in the last 60 days - from $1.50 to $1.49. What were they thinking?
For more on Staples, check out Hoofy and Boo's always astute report.
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