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What: Shares of auto-repair-services specialist Monro Muffler Brake
So what: Monro's fourth-quarter profit didn't miss by much, but paltry same-store sales -- an increase of just 0.7% versus Wall Street's expectation of 1% to 4% -- coupled with a weak first-quarter outlook reinforce concerns about its growth prospects going forward. Management said that cautious customers continue to defer auto-repair spending amid higher gas prices and the uncertain economy, suggesting that things aren't about to pick up anytime soon.
Now what: For the current quarter, management now sees EPS of $0.35 to $0.40 -- well below the consensus of $0.55 -- and expects same-store sales to fall 5% to 7%. "As we look forward, we continue to have a positive long-term outlook for our industry and company," Chairman and CEO Robert Gross said, "though we are more cautious near-term as we believe that higher gas prices and the macroeconomic environment will continue to weigh on consumer sentiment and purchasing behavior." With the stock now off about 30% from its 52-week highs, however, Mr. Market seems to be baking much of the bad news into the price.
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