Logitech Shares Slide as Supplier Factory Shutdown Threatens Holiday Sales
Impact of Supplier Factory Shutdown on Logitech's Performance
July 29 (Reuters) - Shares in Logitech fell on Wednesday as analysts said that a temporary shutdown at a supplier's factory could hit the computer peripherals maker's sales ahead of the crucial holiday shopping season.
Stock Market Reaction
Shares were down around 7% at 0745 GMT after several trading halts in volatile early trading, ranking among the worst performers on the pan-European STOXX 600 index.
Year-to-Date Performance
Including today's move, the shares have gained a mere 0.8% since January.
Financial Impact of Shutdown
The maker of computer mice, keyboards and headsets said on Tuesday that the shutdown would reduce sales by about $20 million in the second quarter and by up to $200 million in the third quarter.
Analyst Insights
Morningstar's Perspective
"High uncertainty on the year," Morningstar analyst Rob Hales told Reuters on the impact of the shutdown, adding that the incident caused the second-quarter guidance to be below consensus.
Vontobel's Perspective
The incident will negatively impact sales going into the important holiday season, Vontobel analyst Michael Foeth told Reuters.
"That will put pressure on the shares even if demand trends and the underlying performance remain favourable," he added.
Reporting
(Reporting by Paolo Laudani)