Raymond James Cuts Tupperware to 'Underperform'
Raymond James downgraded Tupperware (TUP ) to underperform from market perform.
Tupperware says it will no longer sell its products in Target stores, and also forecast 22 cents to 23 cents second-quarter earnings per share.
Analyst Budd Bugatch notes the Target strategy was having a detrimental effect on Tupperware's direct sales business, and caused a decline in consumer interest to attend product demonstrations (Tupperware parties). He fears damage to Tupperware's salesforce activity is significant, and may linger for awhile.
Bugatch says management also noted second-quarter North American earnings per share would be 8 cents to 10 cents below expectations, offset partially by positive trends in Europe. He cut the $1.20 2003 earnings per share estimate to $1.06, and cut the $1.64 estimate to $1.55.