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Novellus boom lifts chips, PCs waver
Dell upgrade helps PCs; Intel launches new PIII
speeds
By Janet Haney, CBS MarketWatch
Last Update: 4:56 PM ET Dec 20, 1999
Silicon Stocks
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NEW YORK (CBS.MW) -- A massive 33 percent upswing in
shares of Novellus helped muscle up some hardware stocks
Monday after the chip equipment maker said its fourth-quarter
earnings will be better than expected.
The Philadelphia Semiconductor Index ($SOX: news, msgs) shot
ahead as much as 4.4 percent, while the Goldman Sachs
Computer Hardware Index ($GHA: news, msgs) fell off its
previous advances to finish the day flat.
Novellus boosts shares
Novellus (NVLS: news, msgs) led
semiconductor stocks higher after the chip
equipment maker said late Friday that
it expects to report better than expected
fourth quarter results. Additionally,
the San Jose, Calif. company announced a 3-for-1 stock split.
Novellus said it anticipates exceeding Wall Street's earnings per
share estimate of 65 cents for the fourth quarter, citing an increase
in booking. Revenue is expected to be in the range of $190 million.
See full story.
The company's shares raced ahead 28 25/64
to 113 9/16, setting a new all-time high.
Applied Materials (AMAT: news, msgs) was
encouraged by the news and rose 5 9/16 116
5/16. Teradyne (TER: news, msgs) jumped 3
13/16 to 53 and KLA-Tencor (KLAC: news,
msgs) gained 4 1/8 to 100 11/16. Lam
Research (LRCX: news, msgs) hit a new
52-week high as its shares closed up 16
15/16, or 18.9 percent, to 106 1/2.
Following Novellus' announcement,
Warburg Dillon Read raised its rating on the
company to "strong buy" from a "buy," with a
new price target of $120 from $90 a share.
Intel tries to one-up AMD
Intel, the world's largest chip maker, unveiled its Pentium III
processors in speeds of 800 megahertz and 750MHz Monday,
coming on the heels of rival Advanced Micro Devices (AMD: news,
msgs) launch of its 750MHz Athlon processor in late November.
The PIII processor 800MHz is priced at $851 in 1,000-unit
quantities and the 750MHz version is priced at $803. See Tech
Report. The processors are based on 0.18 micron technology.
The much-expected announcement makes the 800MHz chip the
fastest yet. Intel (INTC: news, msgs) shares moved down 1 to 81
1/16, while AMD rose 1/2 to 29 5/16.
Additionally, Intel created a new wireless group to focus on the
cellular and wireless communications arena. See press release.
Dell upgrade
A 6 percent gain in Dell Computer (DELL: news, msgs) shares did
little to support PC issues. The computer maker was greeted with
a rating upgrade from J.P. Morgan, with a new outlook of a "buy"
from the previous "market performer." The investment and
banking firm said it thinks momentum will be renewed after the
beginning of the year. Dell's stock gained 2 1/8 to 47 11/16.
Apple (AAPL: news, msgs) lost 2 to 98 and Compaq (CPQ: news,
msgs) fell 3/8 to 25 3/8.
IBM (IBM: news, msgs) slipped 1 15/16 to 108 1/16 and
Hewlett-Packard (HWP: news, msgs) lost 1 to 104 1/4.
Cisco Systems (CSCO: news, msgs) said it will pay $2.15 billion for
Italian conglomerate Pirelli SpA's terrestrial optical system
business, which provides fiber-optic equipment for telecom
networks.
The two groups are
also forming a joint
alliance in the
optical
communications
market, in which
Cisco will invest 10
percent equity
worth $100 million
in Pirelli's newly
formed optical
components division and undersea cable transmissions systems
division. See full story.
Cisco (CSCO: news, msgs) rose 3 9/16 to 103 1/4.
Meanwhile, 3Com (COMS: news, msgs) said it acquired
privately-held Interactive Web Concepts. Terms of the deal
weren't disclosed. IWC has about 40 consultants and the
acquisition is part of a larger push by the networking equipment
maker to build up its services offering. Separately, 3Com will
release fiscal second-quarter results on Tuesday, with analysts
looking for earnings of 34 cents per share. Its shares moved higher
1/8 to 48 7/8.
Lucent Technologies (LU: news, msgs) was ahead by 1 207/256 to
82 79/256. |
