UPDATE 2-G&K Services Q3 profit falls; sees Q4 below Street view

(Adds analyst's comment, updates share movement)

April 29 (Reuters) - G&K Services Inc (GKSR.O: Quote, Profile, Research) posted a 12 percent drop in quarterly profit as operating expenses rose and forecast fourth-quarter outlook below analysts' expectations, sending its shares down as much as 21 percent to a new 52-week low.

The rental company's dismal earnings and outlook prompted Barrington Research analyst Alexander Paris to downgrade the stock to "market perform" from "outperform."

The company posted third-quarter earnings of $10.6 million, or 54 cents a share, compared with $12.1 million, or 57 cents a share, a year earlier.

Revenue rose about 7 percent to $251.1 million driven by rental organic growth, acquisitions and foreign currency gains.

Analysts, on average, expected the company to earn 56 cents a share, excluding items, on revenue of $254.4 million, according to Reuters Estimates.

Total operating expenses rose about 7 percent to $229.6 million for the quarter.

For the fourth quarter, G&K forecast earnings of 50 cents to 54 cents a share, on revenue of $250 million to $253 million.

Analysts were expecting a profit of 60 cents a share, excluding items, on revenue of $257.9 million.

Shares of the Minnesota-based company were down $6.12 at $29.35 in afternoon trade on Nasdaq. They hit a 52-week low of $28.08 earlier in the session. (Reporting by Dilipp S. Nag in Bangalore; Editing by Saumyadeb Chakrabarty)