The Night Watch: AOL Stronger in After-Hours Trading
By Eric Gillin
Editorial Assistant
1/10/00 6:10 PM ET
A quick update on the America Online (AOL:NYSE - news)-Time Warner (TWX:NYSE - news) merger in after-hours trading. America Online was stronger on Instinet ECN, trading at 71 7/8 at 5:35 p.m. EST, a 7/8 improvement from its New York close of 71.
The AOL composite close, which takes into account activity on still-open exchanges in western locales, was 71 15/16, up 15/16 from the New York close, as of 5:47 p.m.
Time Warner's after-hours activity was tougher to pin down. According to Instinet, the issue hasn't changed hands in the last 90 minutes and was last at 92, which is up 1 1/2 from the New York close. Time Warner's composite close was 90 1/16 at 5:01 p.m.
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Why do certain companies move in after-hours trading? Well, it's like Christina Aguilera breathlessly chirps in her hit "Genie in a Bottle."
You gotta rub me the right way.
A fitting example of a good rub was HealthCentral.com (HCEN:Nasdaq - news), which lurked at the top of Island ECN's most-actives list, up 1 19/64 to 14 63/64. HealthCentral.com announced that it will provide e-newsletters to subscribers of Microsoft's (MSFT:Nasdaq - news) Hotmail service on the Microsoft Network. The deal stipulates that HealthCentral.com's content is guaranteed to reach 2 million MSN subscribers.
The MSN deal was immediately chased by a second announcement, which extended HealthCentral.com's shiatsu for a few more minutes. The company announced that it struck a deal with fitness guru Covert Bailey, who is probably best-known for his Fit or Fat book series, which sold 6 million copies.
Now, were either of these deals earth-shattering?
Nope. These announcements weren't AOL big, but the important thing to note was the attention they attract to the stock. Clearly, the rub HealthCenter.com gets from Microsoft is positive and more worthwhile than the Covert Bailey bit. The Web content provider is legitimated after landing a big account from one of America's best-known companies. Meanwhile, the company gets some editorial backup from Bailey, using his name to sell the company further.
Again, these weren't market-moving announcements, but the rub they gave a stock mired in the teens is rather remarkable. Since its IPO on Dec. 7, HeathCentral.com exceeded day-session volume of a million shares on seven days. Four of those occurred within its first four days on the public market. Mid to low six-figure volume is the norm for this company, which traded on 287,000 shares yesterday. Today the company traded on 6.5 million shares, with huge movement in the last two hours of trading as the news began spreading. It ended the day up 4, or 41.6%, to a record close of 13 11/15.
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Other than the Brando-sized movement in HealthCentral.com, the rest of Island's after-hours book was a bit lighter than usual. Penny stock speculators and tech buyers continued to fill Island's dance card.
Compuware (CPWR:Nasdaq - news) made a particularly notable move at the No. 3 spot. The company rose 4 45/64 to 28 on moderate volume. After the bell, the computer services company announced that its third quarter would beat or meet the First Call/Thomson Financial estimate of 33 cents per share. Additionally, the company announced that its third-quarter revenue would be between $620 and $633 million.
The resultant gain is good news for the Michigan-based company, which dropped 5, or 17.7%, to 23 5/16, as investors grew jittery, selling heavily into the closing bell. The day-session loss typifies Compuware's new year. So far, it's off 36% in 2000.
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Large tech names were mixed in the wake of the mammoth AOL (AOL:NYSE - news)-Time Warner (TWX:NYSE - news) announcement.
Yahoo! (YHOO:Nasdaq - news) dropped 1 9/16 to 434 1/2. Qualcomm (QCOM:Nasdaq - news) dropped 1 to 158 1/2. Cisco (CSCO:Nasdaq - news) dropped 11/32 to 109 17/32.
Dell (DELL:Nasdaq - news) rose 3/16 to 44 3/16. Excite@Home (ATHM:Nasdaq - news) rose 1/8 to 40 1/4. BMC Software (BMCS:Nasdaq - news) rose 1/16 to 46.
Sun Microsystems (SUNW:Nasdaq - news) was breaking even.
10 most active stocks on Island ECN (5 p.m. EST)
Company Price Change Session Volume
HealthCentral.com (HCEN:Nasdaq - news) 14 63/64 +1 19/64 2,846,386
Intelect Communications (ICOM:Nasdaq - news) 2 19/32 -13/32 653,824
Compuware (CPWR:Nasdaq - news) 28 +4 45/64 218,784
Herley Industries Warrants (HRLYW:Nasdaq - news) 1/8 -1/32 179,620
Employee Solutions (ESOL:Nasdaq - news) 23/32 0 152,398
Jenna Lane (JLNY:Nasdaq - news) 1 1/4 +3/8 144,930
Imaging Technologies (ITEC:Nasdaq - news) 21/32 -7 /256 96,976
U.S. Home & Garden (USHG:Nasdaq - news) 3 7/8 0 61,262
eGlobe (EGLO:Nasdaq - news) 10 1/4 -3/4 60,852
Yahoo! (YHOO:Nasdaq - news) 434 1/2 -1 9/16 48,368
Island ECN, owned by Datek Online, offers trading, mainly in Nasdaq-listed stocks, from 8 a.m. to 8 p.m. EST..
10 most active stocks on MarketXT (5 p.m. EST)
Company Price Change Session Volume
America Online (AOL:NYSE - news) 72 +11/16 1025
Compuware (CPWR:Nasdaq - news) 29 +5 11/16 900
Lucent (LU:NYSE - news) 58 +1/4 500
eGlobe (EGLO:Nasdaq - news) 11 0 500
Internet Capital Group (ICGE:Nasdaq - news) 164 -1 3/4 175
Red Hat (RHAT:Nasdaq - news) 141 -1/4 100
Applied Micro Circuits (AMCC:Nasdaq - news) 149 1/2 +4 100
Yahoo! (YHOO:Nasdaq - news) 436 -1/16 100
Copper Mountain Networks (CMTN:Nasdaq - news) 55 +1 7/16 100
Vitesse Semiconductor (VTSS:Nasdaq - news) 49 1/4 -5/16 100
MarketXT, formerly Eclipse Trading, offers after-hours trading to retail clients of Morgan Stanley Dean Witter's (MWD:NYSE - news) Morgan Stanley Dean Witter Online, Mellon Bank's (MEL:NYSE - news) Dreyfus Brokerage Services and clients of Salomon Smith Barney. Clients can trade 200 of the most actively traded New York Stock Exchange and Nasdaq Stock Market issues, 4:30 p.m. to 8 p.m. EST Monday through Thursday.
Confused? TheStreet.com explains how the rules change when the sun goes down in Investing Basics: Night Owl, a section devoted to after-hours trading.
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