09:17 ET Gapping Up/Down : CYTO +10.5% (positive ProstaScint study)... LVLT +8% (Microsoft deal)... Gapping Down: CTIX -32% (earnings warning)... AETH -14% (trims revenue outlook)... PRIA -13.5% (earnings warning)... AMCC -7.5% (earnings warning; estimate cuts, downgrade)... SANM -4% (UBS downgrade).
09:12 ET Sun Microsystems (SUNW) 15.04: Morgan Stanley cuts FY02 and FY03 EPS estimates to $0.39 and $0.56; cites global economic weakness, tough FX comparisons, gray market issues, UltraSparc III launch, and more aggressive competition; says weak demand led to substantial price aggression in Q2. Models imply value around $12.50; maintains NEUTRAL rating.
09:03 ET Vitesse Semi (VTSS) 17.40: On the heels of AMCC warning, many firms cutting numbers on VTSS this morning; here are some new/old estimates as a gauge: Dain Rauscher cuts FY02 revenue/EPS to $273M and $0.02 from $482M and $0.35; SG Cowen cuts FY02 EPS to $0.23 from $0.51; Wit SoundView cuts FY02 revenues to $398M from $452M.
07:36 ET Cisco Systems (CSCO) 18.51: Channel checks by Lehman reveal that some of Cisco's end markets may be continuing to see subdued near-term trends. As a result, firm is resetting estimates and moving current Q4 forecast towards consensus. Q4 goes from $0.03 to consensus $0.02; FY02 est. reduced to $0.20, the lower end of analyst $0.16-$0.42 range and compared to consensus of $0.29.
08:54 ET Aether Systems (AETH) 8.23: -- Update -- Company does not give specific revenue or EPS guidance, but says remains comfortable with target date of Q3 2002 to reach EBITDA positive status. Appears that AETH will achieve this goal by cutting expenses; company planning to eliminate jobs, reduce marketing and capital spending. Company plans to provide additional guidance on Q2 conference call in early August.
08:47 ET Aether Systems (AETH) 8.23: -- Update -- Company revises Q2 revenue outlook to reflect flat to modest growth; anticipates slight quarterly revenue growth for the
remainder of the year.
08:45 ET Merrill Lynch (MER) 66.45: -- Update -- Salomon Smith Barney downgrades to NEUTRAL from Buy following earnings warning; reduces price target to $85 from $70.
08:33 ET Economic Data : Durable Orders rose 2.9% in May vs consensus of -0.4%, however, the key nondefense capital goods order figure (a measure of business capital spending) rose just 0.9% after a sharp 5.5% decline in April. Numbers are extremely volatile on a monthly basis; therefore too early to call the May increase a new trend.
08:32 ET QLogic (QLGC) 54.95: Industry channel checks by Banc of America lead firm to believe that QLGC is on track to meet or exceed firm's Q1 rev. est. of $93.4 mln and EPS forecast of $0.23. (Current consensus estimates for Q1 are $93.8 mln and $0.23).
08:27 ET Bear Initiates Software : Bear Stearns initiates coverage on 6 software firms: Borland (BORL 13.32) with a BUY and $20 target, Peregrine (PRGN 26.98) with a BUY and $47 target; Veritas (VRTS 61.44) with a BUY and $90 target; BMC Software (BMC 27.95) with an ATTRACTIVE and $33 target; Tibco (TIBX 13.30) with an ATTRACTIVE and $18 target; webMethods (WEBM 19.05) with a NEUTRAL.
08:07 ET Applied Micro (AMCC) 14.20: -- Update -- Wall Street slashing estimates for a couple years out after company preannounced a significant Q1 shortfall and indicated that it has seen few signs of improvement. Goldman Sachs cutting its FY02 estimates to rev. of $173 mln and EPS of ($0.15) from $233 mln and ($0.05); FY03 lowered to $255 mln and ($0.04) from $315 mln and ($0.05)... CSFB even more aggressive with its cuts, lowering FY02 rev. to $139 mln from $333 mln and FY03 to $169 mln from $455 mln. On a more positive note, Goldman thinks that since warning was widely anticipated the shares actually could hold relatively firm in the near-term.
08:03 ET Goldman on Tech : Goldman Sachs tech analysts Sherlund and Conigliaro revise estimates lower for much of the tech industry, citing continued US weakness, deterioration in Europe/Japan, and the strong dollar. Too many names (39) to mention, but here are a few with their new and old FY01 revenue forecasts: BRCD $516M from $521M; BVSN $351M from $383M; EMC $9.595B from $10.115B; GLW $7.271B from $7.801B; HWP $45.985B from $46.145B; IBM $92.114B from $92.709B; MSFT $25.191B from $25.291B; SEBL $2.434B from $2.464B.
07:16 ET Merrill Lynch (MER) 66.45: -- Update -- Stock tumbles 6 pts in reaction to earnings warning. MER blaming weaker equity and debt trading volumes for the shortfall. Notes that outlook for Q3 remains weak, but that company making progress on expense-reduction initiatives.
07:11 ET Merrill Lynch (MER) 66.45: S&P futures plunge to new morning low in reaction to Merrill Lynch earnings warning. Company expects Q2 earnings to come in between $0.52 and $0.57, well below the $0.83 anticipated by analysts.
07:06 ET Level 3 Comms (LVLT) 4.70: Signs new 3-yr agreement with Microsoft making company one of Microsoft's primary providers of broadband services. Level 3 will provide CrossRoads Internet access service in N. America for six properties in the MSN network of Internet services |
