Wachovia Trims Monster Estimates

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By: Jennifer Saba

Wachovia Equity Research analyst John Janedis trimmed Monster Worldwide’s Q1 earnings per share estimates to 34 cents from 36 cents on concerns of slowing help wanted revenue.

Monster’s quarterly revenue results beat guidance for about two years, the research firm notes. For Q1, however, Monster is expected to grow 28% versus 28% to 30% suggesting a “fairly significant slowing in the [North America] business over the past several weeks,” wrote analysts.

That forecast shaves about $1 million to $2 million of revenue but the market has gotten used to Monster outperforming. “That said, few companies consistently post 28% growth on a consistent basis and we expect solid growth going forward this year.”

Still, growth in the domestic recruitment category is expected to decelerate this year increasing 12.4% versus 13.9%. Janedis and his team believe there is some hesitancy on the part of small and medium-sized businesses to hire based on concerns of an economic downturn.

Newspapers are expected to feel this impact. Wachovia believes help wanted revenue could decline 10% this year.

“Domestic employment advertising appears to have reached an inflection point earlier in the cycle than usual, and decelerating employment may pressure the trajectory of earnings growth,” wrote analysts.

Wachovia marinated its “market perform” rating on Monster.

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