Say what you will about the ups and downs of consumer products companies like Chattem
Remember, this is the company whose estimates and market cap have been melting like ice cream in the sun for a while now. This is also the company that said it needed to "execute flawlessly" on cost-cutting initiatives to achieve the annual savings goals needed to uphold guidance. When a company that hasn't even executed at an average level needs to improve to flawless, you're asking for trouble.
Management didn't blame this quarter's projected underperformance on non-flawless execution on the cost side. Rather, it was the state of battery sales in Europe and shaving/grooming products in North America that were to blame. I guess the French and Germans bought too many Duracells from Procter & Gamble
Perhaps some of the reaction is due to the fact that Spectrum didn't say how bad things actually are -- it just said "substantially lower" than prior guidance. I guess when you've been performing like this, "substantially lower" could be really, really bad.
The company also noted that it has hired Goldman Sachs
When I last wrote on Spectrum, I said I wanted to see a quarter or two of leveling-off before taking the plunge on a turnaround. Suffice it to say, that isn't happening right now. At some point I'm sure there's a bottom-of-the-barrel value on these assets, but your guess is as good as mine as to whether we've reached that yet.
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Fool contributor Stephen Simpson has no financial interest in any stocks mentioned (that means he's neither long nor short the shares).