CORRECTED - CORRECTED-UPDATE 1-Stanley Works Q3 profit tops market; ups '09

(Corrects paragraph 7 to show company's prior 2009 earnings outlook was $2.34 to $2.84 a share, not $2.50 to $2.60 a share plus a 34 cent a share gain on debt extinguishment in Q2)

* Q3 EPS from cont ops $0.77 vs. est $0.62

* Q3 rev $935.5 mln vs. est $952.6 mln

* Raises 2009 EPS view to $2.84-$2.94

Oct 21 (Reuters) - Tool maker Stanley Works (SWK.N) posted a better-than-expected quarterly profit, helped by lower commodity costs and stable performance in the security segment, and raised its earnings outlook for the full year.

The company posted a third-quarter profit of $60.4 million, or 75 cents a share, compared with $163.0 million, or $2.04 a share last year that included a gain of $128.1 million from divestiture.

Income from continuing operations were $61.8 million, or 77 cents a share, compared with $77.1 million, or 97 cents a share, a year earlier.

Revenue fell 16 percent to $935.5 million due to a decline in unit volumes in its segments.

Analysts on average were expecting earnings of 62 cents a share on revenue of $952.6 million, according to Thomson Reuters I/B/E/S.

Sales at the security segment rose 3 percent to $403 million in the quarter.

Stanley Works said it now expects earnings for 2009 to range between $2.84 and $2.94 a share, up from the previous forecast of $2.34 to $2.84 a share.

Analysts were expecting earnings of $2.36 for the year.

Shares of the company closed at $46.34 Tuesday on the New York Stock Exchange. (Reporting by Amulya Nagaraj in Bangalore; Editing by Maju Samuel)