United turns to ‘self help’ as profits tumble
However, the company’s house broker said it is reducing its full-year 2012 pre-tax profit forecast to £1m, down from £1.1m, taking its earnings per share estimate down to 0.84p from 0.92p, predominantly because of concerns on the first-quarter 2012 outlook. For full-year 2013, Seymour Pierce is also reducing its pre-tax profit forecast to £1m, from £1.3m, and downgrades its dividend forecasts, following the interim cut, to 0.25p from 0.75p.
The broker reduced its target price for United Carpets to 10p from 13p but retained a ‘buy’ recommendation on the stock as it thinks it remains undervalued at 7.1 times full-year 2012 earnings.