UPDATE: Hurco stock dives after earnings report

May 23, 2008

Shares of Hurco Cos. Inc. plunged 17.2 percent this morning after the Indianapolis-based machine tool maker reported profit that missed analysts' expectations.

Hurco said it earned 85 cents per share in net profit, 3 cents less than analysts surveyed by Thomson Financial.

The shares, which have traded near historic highs for the company, slumped to $38.88.

In recent months the stock has traded at about $50, which is near a record $60 set in October.

The drubbing came despite Hurco's reporting a 17-percent increase in profit during its second fiscal quarter ended April 30.

Healthy European demand and expansion into eastern Europe helped the Indianapolis-based machine tool maker turn $5.5 million in profit on sales and service fees of $58.3 million, which was up 37 percent.

About 12 percent of the revenue growth reflects the effect of a weaker U.S. dollar, Hurco said today.

European orders increased nearly $11 million, or 33 percent.

Orders in Asia and North America fell 3 percent.

"While there is no denying the economic pressure being felt in many markets, Hurco is fortunate that the strategic plan we have continued to implement during the past seven years allows the company to endure these cycles," CEO Michael Doar said in a statement.

Hurco profit has been on a roll. In the first quarter, profit climbed 45 percent due to growth in Europe and Asia. The growth comes after several years of struggles as American machine tool makers worked to become more efficient and competitive with new foreign rivals.

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