Estee Lauder shares plunged after its forecast for the fiscal 2012 year fell way short of analysts' estimates. But given the language used by the make-up giant, investors shouldn't read too much into the guidance, or any such forecast given by any companies that count on the U.S. and Europe for the majority of their sales.
"At this time, the Company's outlook does not assume the recent economic uncertainty and volatility taking place in the United States and certain European countries will have a major impact on consumer spending and on its business," read the Estee Lauder press release.
"This is typical cover your butt legalese," said
Last week, the market churned in a way never seen before as the aftermath of the Standard & Poor's downgrade of U.S. Sovereign debt by a notch was met by the global market's rejection of Greece's second bailout. The Dow Jones Industrial Average moved 400 points in either direction for four straight days, the first volatility of that kind ever.
Estee Lauder gave a rather wide range of estimated earnings per share for the fiscal 2012 year of between $4 and $4.20. Reuters had a consensus analyst estimate of $4.27.
"The volume of negative news and the unsettling impact on equity markets is having a significant effect on already fragile consumer mindset," said Robert Niblock, CEO of Lowe's , on the company's earnings call Monday.
Lowe's shares opened significantly lower after the home-improvement retailer cut its full-year forecast as well.
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