Kodak shares slump on digital warning



Eastman Kodak’s shares on the NYSE dropped 3.9 per cent to close at $23.16 on 5 October, its lowest level for nearly two years, as analysts expressed concern over weak profit in the digital market and a declining traditional market for the firm.
Kodak has reported that it expects 2005 operating profit from digital products to be "somewhat behind the ambitious target of $275 million to $325 million" it set for the year, as a result of weakness in its business with the medical industry and slower growth in the US.
On the same day of this announcement, JP Morgan Securities downgraded the company’s stock to underweight from neutral, and said it expects revenue of $14.36 billion for the current year and $14.95 billion for 2006.
On a more positive note for the future, Kodak’s total digital revenue growth in 2005 is expected to exceed its original 36 per cent forecast, thanks to faster-than-expected sales growth in digital products such as commercial printing, cameras and special paper, the company said.