Barron’s Sees Barnes & Nobles (BKS) Tumbling
November 25, 2009 10:42 AM
Today, Barnes and Nobles (NYSE: BKS), the largest U.S. bookseller, reported a higher second quarter loss. Loss in the second quarter of the year is expected to be in the tune of 30 cents per share.
According to Barron’s, lowered third-quarter profits and gloomy annual guidance further damaged B&N shares and sent prices tumbling. B&N stock price has lost over 10% in the recent past. Barnes and Nobles revised its third-quarter profit projection from $1.50 to $1.30 per share, while full-year profit projection was downgraded by 26 cents.
Barnes & Nobles' fortune has not only been affected by a sluggish economy but it is also facing issues on other fronts as well. Increasing competition, deep discounts and emergence of electronic books and readers have dealt a severe blow to traditional book sellers. B&N has recently introduced its own e-book reader Nook to counter the competition from Sony’s Kindle and Amazon. Higher cost associated with Nook was an important factor in lowered forecasts.
