The Successful Investor Hotline – Friday, August 12, 2011

Article Excerpt

CANADIAN TIRE CORP., $56.55, Toronto symbol CTC.A, reported lower-than-expected earnings this week. In the three months ended July 2, 2011, the company earned $105.8 million, or $1.29 a share. That missed the consensus estimate of $1.45 a share. The latest earnings are also down 13.8% from $122.8 million, or $1.50 a share, a year earlier. Canadian Tire spent more on advertising. As well, cooler spring weather hurt sales of seasonal merchandise, such as gardening equipment. Canadian Tire’s earnings were also held back by costs related to the upcoming, $771-million purchase of The Forzani Group Ltd. (Toronto symbol FGL). Forzani sells sporting goods through over 500 stores in Canada, including SportChek and Athlete’s World. Canadian Tire aims to complete this purchase by the end of September 2011. Overall sales rose 4.1%, to $2.6 billion from $2.5 billion. Sales rose 5.1% at the company’s main retail division, which consists of its 487 Canadian Tire stores, 290 gas stations, 384 Mark’s Work Wearhouse casual-clothing stores and…