Although we don't believe in timing the market or panicking over market movements, we do like to keep an eye on big changes -- just in case they're material to our investing thesis.
What: Shares of office supply maker ACCO Brands (NYSE: ACCO ) dropped 17% today after the company reported earnings.
So what: Third-quarter revenue was down 6.4% from a year ago to $469.2 million, well below the $488.1 million estimate from Wall Street. On the bottom line, earnings of $0.25 per share were $0.08 worse than estimated.
To make matters worse, the company guided full-year earnings of $0.78 to $0.81 per share, below the consensus $0.88 estimate.
Now what: There was really weakness across the business, and management expects full-year revenue to decline mid- to high single digits. That's not the kind of trajectory you want out of any company, and it makes this stock look like a value trap. Shares trade at just seven times the top end of this year's estimates, but with conditions getting worse, I still don't see that as a good value for investors.
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