Safeway’s Q3 Profit Beats, but Revenue Misses; Forecast Reaffirmed (SWY)

Supermarket chain operator Safeway Inc. (SWY) on Thursday posted mixed third quarter earnings results and stood by its previously-announced full-year outlook.

The Pleasanton, CA-based company reported third quarter net income of $157 million, or 66 cents per share, compared with $130.2 million, or 38 cents per share, in the year-ago period. Excluding special items, adjusted profit was 45 cents per share.

Revenue edged slightly lower from last year to $10.05 billion.

On average, Wall Street analysts expected a smaller profit of 42 cents per share, albeit on higher revenue of $10.24 billion.

Looking ahead, SWY maintained its full-year 2012 earnings outlook at $1.90 to $2.10 per share. Analysts are currently looking for $1.98 per share for the year.

Safeway shares fell 65 cents, or -4%, in premarket trading Thursday.

The Bottom Line
Shares of Safeway (SWY) have a 4.30% dividend yield, based on last night’s closing stock price of $16.29. The stock has technical support in the $14-$15 price area. If the shares can firm up, we see overhead resistance around the $18-$19 price levels.

Safeway Inc. (SWY) is not recommended at this time, holding a DARS™ Rating of 3.1 out of 5 stars.

Be sure to visit our complete recommended list of the Best Dividend Stocks, as well as a detailed explanation of our ratings system here.

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