Schaeffer's Trading Floor Blog
This morning, Intuit (INTU) announced that it will slash about 575 jobs, or about 7% of its workforce, as the result of a reorganization to speed growth. The company expects the cuts to result in a charge of $22 million, or 4 cents per share, in the fiscal fourth quarter. Intuit now expects an adjusted fourth-quarter loss of 7 cents to 9 cents a share, compared to the Street estimate of a 7-cent loss. Adjusted earnings per share for the year are forecast at $1.57 to $1.59, above the consensus estimate of $1.55 per share.
Investors were less than pleased with the news, as the shares are down 1.55% this afternoon. The stock was rejected recently at the 30 level – site of a double top for the shares - and is potentially headed back down for a test of support in the 26 area. Since peaking in October 2006, the stock has been moving relatively sideways between support at the 26 level and resistance at the 33 level.
Options players are complacent, with the Schaeffer's put/call open interest ratio sitting in the exact middle of its annual range. Meanwhile, Wall Street is quite skeptical of the shares. Zacks reports that 3 rate it a "buy," 6 give it a "hold," and 1 rates it a "sell." Until the stock shows signs of breaking out of its trading range, this may be one to just put on the backburner for a while.
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