Water heating equipment firm AO Smith (AOS) is the latest company that looks to have gotten too lean in their inventory situation.
The company sees earnings for the quarter ended March 31st of about 97cents, way above the 68cents expected by Wall Street:
MILWAUKEE, March 23 /PRNewswire-FirstCall/ -- A. O. Smith Corporation (
NYSE:AOS - News) today announced that it expects to significantly exceed analysts' first quarter earnings estimates. The company projects its first quarter results will be between $.95 and $1.00 per share.
"Both of our business segments are experiencing higher sales volumes than we originally expected," commented Chairman and Chief Executive Officer Paul W. Jones. "In addition, the results of our extensive cost reduction efforts and continuing strength in water heater sales in China will benefit the first quarter."
The company increased its full-year earnings forecast to $3.20 and $3.40 per share and intends to release its first quarter 2010 results before the market opens on April 20.
Sales came in higher than "originally expected" in part because the company planned too conservatively. Inventory as a % of sales in the December quarter was the lowest it's been in many years:
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