Jeronimo Martins SGPS SA, Portugal’s biggest retailer by market value, dropped to the lowest in almost 10 months in Lisbon trading after reporting earnings that missed analysts’ estimates as Polish consumption weakened.
The stock fell as much as 9.6 percent to 11.255 euros, the lowest since October and the fourth consecutive decline. It traded at 11.88 euros as of 12:27 p.m. in the Portuguese capital. The shares have declined 6.7 percent this year, giving the grocer a market value of 7.5 billion euros ($9.1 billion).
Jeronimo Martins said first-half net income rose 5.6 percent to 151.9 million euros, lower than a mean estimate of 158.6 million euros in a survey of analysts by Bloomberg.
“Jeronimo Martins shares have been falling, reflecting this easing earnings momentum,” Jose Rito and Bruno Bessa, analysts at Banco BPI SA with a “neutral” recommendation on the stock, said today in a research report.
The company said it expects the margin at the level of earnings before interest, taxes, depreciation, and amortization in 2012 will be stable or “just below” last year’s level. Polish unit Biedronka will miss a goal for “low double-digit” growth in like-for-like sales this year due to slowing economies, Jeronimo Martins said.
“Short-term sentiment will remain negative and the stock price should react negatively following the company’s like-for-like revision,” BPI’s Rito and Bessa said in the note.