Watson Wyatt Plummets on Lowered Outlook

Watson Wyatt Worldwide Inc. (WW) slashed its 2009 earnings guidance after reporting a 9% decline in fiscal third-quarter sales today. Shares plunged more than 15% on the news.

The consulting firm now expects earnings between $3.35 and $3.40 per share on revenue of $1.65 billion to $1.67 billion. It had previously guided earnings of $3.50 to $3.57 per share and revenue of $1.67 billion to $1.72 billion.

Analysts, on an average, have been expecting full-year earnings of $3.55 per share.

Watson Wyatt projects fourth-quarter earnings of 65 cents to 70 cents per share, lower than analysts' expected profit of 86 cents. Revenue is expected in the range of $370 million to $390 million.

The company's third-quarter profit amounted to 95 cents per share, a penny shy of the 96 cents earned in the year-ago-quarter. However, earnings came in ahead of analysts' expectations by 2 cents.

Revenue fell to $417 million from the last year's $457.5 million.

Watson Wyatt, a Zacks #3 Rank ("Hold"), is trading on heavy volume of 2.7 million shares, versus the daily average of 360,173.

Read the full analyst report on WW