Bad Weather Cuts Briggs’ Sales, Earnings

Article Excerpt

BRIGGS & STRATTON CORP. $25 (New York symbol BGG; Conservative Growth Portfolio, Manufacturing & Industry sector; WSSF Rating: Above average) now expects that it earned around $1.95 a share in its fiscal year ended June 30, 2006, down 13% from its fiscal 2005 earnings of $2.25 a share. The company blamed the lower earnings on rainy weather during the late spring and early summer, which hurt demand for lawnmowers and other garden equipment. Rising fuel and metal costs have also hurt profits. Briggs is now cutting production to keep its inventory levels down. The stock has moved down from $40 at the start of 2006, and now trades at 12.8 times its fiscal 2006 profit forecast. But demand for Briggs’ power generators is steady (generators and other electrical products account for 40% of Briggs’ sales), and could jump if this year’s hurricane season is as severe as last year’s. Briggs’ $0.88 dividend seems safe, and yields 3.5%. Briggs & Stratton is a buy…

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