American Greetings Burns Its Cards On Earnings (AM)

Apparently being in the business of selling greetings cards for $5.00 per card is not quite as profitable as you might imagine.  That is the case for American Greetings Corporation (NYSE: AM) just in time for Christmas.

The company reported earnings of $0.50 EPS on sales of $463.6 million. Thomson Reuters had estimates of $0.81 EPS and $439.4 million in sales.  A previous target for 2012 was to get revenues up 3% but now the company noted that it feels confident that it can meet or beat those expectations.
 
American greetings noted higher costs and also has raised its cap-ex planes to $55 million to $70 million versus a prior 2012 projection of $45 million to $50 million.  This is lowering cash flow projections to $90 million to $110 million from a prior target of $125 million to $145 million.

Let’s just say that the market is much less than receptive today.  Shares are down 19.4% at $13.69 and that breaks the chart for a new 52-week low.  The prior 52-week range was $15.20 to $24.84.

JON C. OGG