The company again predicts strong growth for the coming year, but financial experts aren’t as optimistic.
Maytag Corp. executives showered Wall Street analysts with upbeat remarks Friday about the Newton appliance company’s outlook for the coming year, but the corporate confidence failed to create much of a stir on the New York Stock Exchange.
Maytag shares closed at $26, down 20 cents for the day.
Maytag hosted a conference with financial analysts in New York City, where Ralph Hake, the company’s chairman, predicted business growth next year, fueled by new, innovative products.
But Laura Champine, an analyst with Morgan Keegan Inc., said of the prediction, “This is kind of a repeat of last year.”
Maytag predicted strong growth a year ago, but the company managed to eke out only a slight increase in overall sales, Champine said. This year’s predictions seem to be a replay.
“I think it’s pretty aggressive to say the industry is going to grow 1 to 2 percent, but your company can grow 5 to 7 percent,” she said.
In his presentation, however, Hake was optimistic.
The outlook is good for increased sales of major home appliances, and the company has made progress in improving the performance at its troubled Hoover floor care products division, Hake said.
Hoover sales have suffered because of a shift in consumer preference to lower-priced vacuum cleaners, rather than more expensive models that have been a Hoover staple. Hoover has responded with models priced below $100. The company has not given up on high-end products, however, and has plans for more new products next year in the lower-, middle- and upper-price ranges, Hoover President Tom Briatico said. Among other plans: test-marketing a carpet cleaning service for residential customers. The service comes on the heels of Maytag’s plans to broaden its appliance repair business by having Maytag repairmen service other appliance brands, too. Maytag plans to introduce more new products next year in various appliance categories, although no specifics were disclosed. The company also expects to see benefits from its 2003 product introductions, including the top-loading version of the Neptune washing machine.
Maytag expects to earn between $1.90 and $2 a share in 2004 after subtracting a 40-cent charge for restructuring, primarily related to the closing of Maytag’s refrigerator factory in Galesburg, Ill.
Hake said 2004 earnings could be hurt if negotiations on union labor contracts lead to disruptions in production at company plants in Newton and Amana.
Maytag’s earnings for 2003 are expected to be between $1.62 and $1.67 a share, after a 53-cent special charge is subtracted. Earnings in 2002 were $2.40 a share.