US SMALL/MIDCAPS-Booksellers' shares burned after results

NEW YORK Nov 24 (Reuters) - A pair of large booksellers lost ground on Tuesday after weak results and lackluster expectations for holiday sales.

Midcap Barnes & Noble (BKS.N) dropped 6.6 percent to $21.97 after cutting its full-year forecast in anticipation of a difficult holiday season, while rival Borders Group BGP.N tumbled nearly 13 percent to $1.75 after posting a wider-than-expected loss. For details, see [ID:nN24302938]

The booksellers are in the midst of a price war with Amazon.com Inc (AMZN.O) and Wal-Mart Stores Inc (WMT.N) as they contend with rising online sales. Barnes & Noble, meanwhile, saw costs increase as a result of spending on its Nook electronic reader.

Goldman Sachs later added Barnes & Noble stock to its "conviction sell" list, saying, "We expect long-run EPS declines at Barnes & Noble associated with the financial implications of a paradigm shift in the distribution of written content."

Small-cap Genesco Inc (GCO.N) dropped 6.9 percent to $26.57 after the shoe and hat retailer reported better-than-expected quarterly profit, but issued fourth-quarter earnings guidance below Wall Street's expectations. [ID:nBNG500834]

Hillenbrand Inc (HI.N) shed 7.2 percent to $18.51 after the funeral products maker posted fourth-quarter earnings in line with analysts' expectations, but forecast earnings for 2010 that were below analysts' estimates.

The S&P SmallCap Materials index .6GSPM dropped 1.2 percent, weighed down by a 6.4 percent drop in Quaker Chemical Corp (KWR.N) after the company filed a $100 million shelf registration.

The S&P MidCap 400 index .MID fell 0.4 percent, while the S&P SmallCap 600 index .SML lost 0.8 percent. In comparison, the large-cap S&P 500 .SPX was flat. ((Charles.mikolajczak@thomsonreuters.com; +1 646 223 5234;

Reuters Messaging:rm://Charles.mikolajczak.reuters.com@reuters.net))