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The stock fell 19% to $45 in afternoon trading, moving on a volume of about 3.7 million shares. The issue's 30-day average volume is 692,585 shares. Despite the drop, the shares have, of late, been a strong performer, rising 69% since the start of 2008.
BB&T Capital Markets, which cut the company to hold from buy, said the outlook for the company "is not as robust as it was just a few months ago."
"We believe the stock could struggle to move materially higher in the near-term given the increasing headwinds. So we prefer to take a more cautious stance (along with management)," it added.
The view was echoed by Robert W. Baird, which downgraded the company to underperform from neutral and cut its target to $58 from $45. "We overestimated how much drilling pumps would jump with energy prices; energy backlog and margins were thus unexpectedly low," the firm wrote. It added that compressor orders and backlog slowed during the company's second quarter, and that management had emphasized a "cautious" view for global demand.
After the closing bell Wednesday, Gardner Denver affirmed its third-quarter earnings outlook of 84 cents to 88 cents a share and its 2008 outlook of $3.65 to $3.75 a share. The analyst consensus is for earnings of 90 cents a share in the third quarter and $3.81 a share in the year.
The company reported second-quarter net income of $49.6 million, or 93 cents a share, on revenue of $518.1 million. The mean estimate of analysts polled by Thomson Reuters was for earnings of 94 cents a share and revenue of $497.2 million. Ryan Vlastelica rv/vj
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