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Computer Sciences Stock Plunges on Weak Outlook

Wednesday, 09 Nov 2011 05:14 PM

 

Shares of Computer Sciences Corp., a contractor for U.S. government agencies and companies, fell the most in nine years after reducing its fiscal 2012 profit forecast amid “federal budget uncertainty.”

The shares declined 15 percent to $27.90 at 4:15 p.m. in New York, the biggest daily drop since Sept. 19, 2002. Computer Sciences, based in Falls Church, Virginia, has slid 44 percent this year.

“North American public sector business continues to be impacted by the federal budget uncertainty,” Chief Executive Officer Michael Laphen said in a statement today.

Earnings for the year ending March 31 will be $4.05 to $4.10 a share, excluding some items, the company said in the statement. In August, Computer Sciences forecast per-share profit of $4.70 to $4.80.

Computer Sciences also reported a second-quarter net loss of $2.88 billion, or $18.56 a share, including a goodwill impairment and a previously disclosed claims settlement. Excluding those items and costs related to the acquisition of health-care software maker ISoft, Computer Sciences had profit of 94 cents a share in the quarter ended Sept. 30, according to the statement. That beat the 68-cent average of 11 analyst estimates compiled by Bloomberg.

Revenue rose less than 1 percent from a year earlier to $3.97 billion. The company had net income of $184 million, or $1.18 a share, in the previous year’s second quarter.

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