Dun & Bradstreet Plunges 7% on Falling Revenue, Downbeat Outlook

Data provider Dun & Bradstreet (DNB) has plunged 6.4$% to $79.81 today after earnings disappointed.

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And boy did they disappoint. From Dow Jones Newswires:

Dun & Bradstreet reported a profit of $96 million, or $2.20 a share, up from $93.4 million, or $1.93 a share, a year earlier. Excluding restructuring-related charges and other items, adjusted earnings were up at $2.38 from $2.21. Revenue decreased 7.1% to $463.1 million.

Analysts polled by Thomson Reuters most recently projected earnings of $2.41 on revenue of $474 million.

Even worse, the company expects nothing to change in 2013. From Baird’s Daniel Leben:

Core revenue growth of 0-3% implies revenue of $1.64-$1.69 billion, below consensus and our estimate of $1.71 billion, although the growth rate is consistent with consensus after adjusting for the 4Q12 shortfall. EPS growth was guided to 8-11% y/y or $7.50-$7.70 vs. consensus of $7.90 and our $8.16 estimate. Our initial reaction to guidance is that management is likely taking a conservative view given the unknown timing of an improvement in North America RMS growth and potential margin expansion.

And one of the main reasons earnings per share rose was because the company has been buying back shares. From Raymond James analyst William Warmington:

Significant stock repurchases in 4Q12 ($244 million) are expected to drive positive EPS growth in 2013, despite negative net income growth. Of the $1 billion repurchase basket (authorized on 10/31/11 and 8/9/12), $30 million was used in 2011, $480 million was used in 2012 and we expect the remaining $490 million to be executed by mid-2014.

They’re also using borrowed money to do it,� says Fil Zucchi over at Minyanville–not a good sign for a company already in debt.

Shares of Dun & Bradstreet had jumped 8.4% this year through yesterday’s close. Now they’re close to flat.