General Cable falls after its third-quarter forecast widely misses Wall Street expectations

General Cable down, 3Q outlook misses consensus

NEW YORK — Shares of General Cable Corp. fell sharply Thursday after the wire and cable maker said its third-quarter earnings will miss Wall Street expectations by a wide margin.

The Highland Heights, Ky., company issued its guidance when it reported second-quarter results Wednesday after the market closed. General Cable beat analyst expectations for April through June, but it forecast third-quarter earnings below consensus estimates.

Third-quarter earnings per share will be 45 cents to 55 cents on revenue of $1.05 billion to $1.1 billion, the company said.

A Thomson Reuters poll of analysts found their average expectation is for 72 cents per share on revenue of $1.18 billion.

“We expect demand for our products will continue to be weak as a result of project deferrals and cancellations in many of our end markets as a consequence of tighter credit markets and reduced energy consumption,” the company said in a statement.

Further, the third quarter will suffer from “extended summer shutdowns in an effort to continue to balance inventory levels with expected weak end-market demand, which will result in incremental unabsorbed fixed costs but favorable cash flows,” General Cable said.

CL King analyst Gary Farber said in a client note that third-quarter results also will be hindered by a recent rise in the cost of copper and aluminum, among other raw materials, and normal seasonal patterns.

Farber has a $35 price target and an “Accumulate” rating on the stock.

In midday trading, shares fell $5.90, 13.9 percent, to $36.60. In the last 52 weeks, the stock has ranged from $6.73 to $59.14.