By: Jennifer Saba
Wachovia Equity Research lowered its forecast for Monster Worldwide based on signs of slowing recruitment advertising in North America.
Monster is set to release its 2Q earnings on Monday, but Wachovia senior analyst John Janedis cut the company’s estimates for the second half of the year.
“While we continue to believe 2Q is intact, we think early 3Q has decelerated somewhat and we are lowering our [second half of 2007 and 2008] estimates to reflect the North America environment,” he wrote in a note released on Thursday.
Wachovia expects the Monster Employment Index (MEI) to drop in the mid-single digits in July compared to June.
Meanwhile, the Conference Board reported that in June its Help-Wanted Employment Index, which measures print recruitment ad volume in 51 newspapers across the country, hit a 49-year low.
For 3Q Wachovia lowered it earnings per share estimate from 40 cents to 38 cents. In 2008 the EPS forecast was cut from $2.06 to $1.86.
“As we have written in the past, we think the bigger risk for Monster’s earnings is on the expense side driven by investment in the brand,” he wrote.
Monster is rated “market weight” by Wachovia.