Wednesday, January 11, 2012

Investopedia: Philips - Plenty Of Cloud, Minimal Silver Lining


Dutch conglomerate Koninklijke Philips (NYSE:PHG) has been an underachiever for so long now, it hardly seems fair to call another poor quarter a "disappointment." Nevertheless, the company announced that its fourth quarter results would be meaningfully short of analyst expectations and the stock is weak once again. Although Philips may remain a fixture on the "due for a turnaround" lists, investors would do well to stay skeptical about this company's ability to compete as currently constructed. (For more, see Earning Forecasts: A Primer.)


Another Warning
Although estimates have come down as much as one-third over the last quarter, Philips still found a way to underperform in the fourth quarter. Management guidance suggests that sales will come in a few percentage points below expectations, while margins fell off even worse. Based on an informal survey of sell side analyst expectations, it looks like Philips' anticipated EBITDA of 500 million euros will be some 10-20% short of estimates.


Please continue here:
http://stocks.investopedia.com/stock-analysis/2012/Philips--Plenty-Of-Cloud-Minimal-Silver-Lining-PHG-SI-GE-CREE0111.aspx

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