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AMERCO (Nasdaq: UHAL) (N) (S) was hauled down $4 1/4 to $26 7/8 after the holding company for do-it-yourself moving firm U-Haul International provided guidance that its first quarter fiscal year 1998 earnings will not meet expectations. Like clockwork, slavish analysts have begun to trim estimates, and Lehman Brothers cut its rating on the shares to "neutral" from "buy." The questions remain, has anything fundamentally changed about the business, and should investors sell before the release of the company's numbers next Tuesday (Aug. 19)? The company has attributed the anticipated shortfall to the somewhat nebulous "weakness in truck rental revenues." Amerco hovers near a 52-week low and trades at 0.53x trailing 1997 sales. Growth in sales has been low but solid at 7% (5-year average). In this mature business, execution becomes essential. However, any operational difficulties such as the cited "increase in fleet repair costs" can usually be turned around rather quickly. With its brand name and business intact, sustained revenue pressure is the only real threat to Amerco's business.
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