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Supervalu Shares Plunge on Poor Q1 Results

The company will suspend its dividend and cut spending


SuperValu (NASDAQ:SVU) said sales during its fiscal first quarter dropped to $10.6 billion, compared to $11.1 billion during the same quarter last year. Earnings for the quarter also tumbled to $41 million, down from $74 million last year.

Worse, the supermarket chain announced that it would suspend its dividend, slash capital spending and was conducting a strategic review of its options, Fox Business noted.

Bracing for an Ugly Earnings Season
Bracing for an Ugly Earnings Season

Investors hammed the company shares, driving them down more than 46% in Thursday afternoon trading.

The company withdrew is previously stated financial outlook, worrying analysts and causing Standard & Poor’s to put its credit on a negative watch.

An analyst at Credit Suisse (NYSE:CS) warned that SuperValu could become “the next casualty in the troubled supermarket space” and advised against acquiring its shares.

Other analysts said the company would likely try to sell itself.

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