The Black & Decker Corp. is going through turbulent times.
Following a third quarter that made $125.1 million in net earnings, just a 3 percent increase from 2005?s mark, the Hunt Valley-based power tool, hardware and home improvement company announced in December that its fourth quarter results would decline about 8 percent.
Within the last year, stock prices of Black & Decker have fluctuated between $94.90 and $66.04.
John Kearney, a stock analyst from Morningstar, a financial news and analysis organization, told The Examiner the market for newly built homes, or “new housing starts,” is on the decline, projected to decrease 27 percent in 2007.
“I think that the new housing market is going to be down,” Kearney said. “Sothat is a stiff headwind for [Black & Decker].”
The hardware company is even having trouble keeping products in stores with the slow market. According to Kearney, “big box” retailers like Lowes and Home Depot are cutting back on inventory, and subsequently slicing into Black & Decker?s market presence and item production.
“It?s a company that has a well-respected brand name and has been pretty innovative and had good products,” Kearney said. “From that standpoint, they should fare better than most, but it could be tough sledding over the next year or so.”
Merger nears completion
Mercantile Bankshares, a Baltimore-based investment and banking company, is nearing the completion of a $6 billion deal with Pittsburgh-based PNC Financial Services.
The deal is expected to be completed during PNC?s first quarter of 2007. When the merger closes, stocks of Mercantile will cease to exist.
Jaime Peters, an analyst for Morningstar, told The Examiner that Mercantile shareholders will receive 0.418 of a share of PNC, plus $16.45 in cash, for each Mercantile share they hold.
To Peters, the merger seemed like an odd business move.
“The sale doesn?t make too much sense to us [at Morningstar] since Mercantile has lots of small little banks,” Peters said. “PNC is a regional player, so it will have to go in and rework a lot of the management of Mercantile.”
Both Black & Decker and Mercantile Bankshares are part of The Examiner Top 10, which follows stocks in the largest publicly held companies located in the Baltimore region.
