Investors bid up hardware stocks
cbs.marketwatch.com
Investors bid up hardware stocks
3Com to post second-quarter results
By Janet Haney, CBS MarketWatch
Last Update: 5:13 PM ET Dec 21, 1999
NEW YORK (CBS.MW) -- Personal computer and chip stocks
went through the roof Tuesday, as sizeable gains from Teradyne
and Compaq Computer shares provided an upward boost to the
sectors.
"The stocks are out of sight and will probably go further out of sight
before coming back to earth," said Stan Chadsey, an analyst at
Capital Planning Associates.
The Philadelphia Semiconductor Index ($SOX:
news, msgs) advanced 4.7 percent to 698.88,
setting a new all-time high. The index is up a
whopping 100 percent for the year.
Additionally, Semiconductor Equipment and
Materials International said the North
American-based chip equipment makers reported a November
book-to-bill ratio of 1.10 vs. the 1.08 posted in October. The
book-to-bill ratio means for every $110 in orders received, $100
worth of products were shipped.
"Semiconductor manufacturing equipment bookings posted an
all-time monthly high in November," said Stanley T. Myers,
president of SEMI. "The growth pattern in semiconductor sales
and the increasing adoption of new technologies has helped drive
continued strength in the equipment market."
Chip equipment makers were higher in trading. Applied
Materials (AMAT: news, msgs) gained 7 5/16 to 123 5/8 and
KLA-Tencor (KLAC: news, msgs) rose 7 3/16 to 107 7/8.
Teradyne (TER: news, msgs)
advanced 7 1/4 to 60 1/4, and Novellus (NVLS: news, msgs)
continued on its tear, rising 4 3/16 to 117 3/4.
Shares of a number of telecom equipment makers were higher.
J.P. Morgan Securities raised its price target on Motorola to $165
per share from $120 while Qualcomm's (QCOM: news, msgs)
target was lifted to $570 from $460 a share. In addition, Foundry
Networks' (FDRY: news, msgs) target was increased to $360 from
$225 per share. Motorola (MOT: news, msgs) shares jumped 4
11/128 to 138 3/4. Qualcomm added 30 1/8 to 496 7/8, while
Foundry was up 20 to 314.
Intel (INTC: news, msgs), the world's largest chip maker, gained 1
13/16 to 82 7/8. Micron Technology (MU: news, msgs) advanced 4
5/8 to 80 1/2 ahead of its quarterly results on Wednesday.
Apple shares get a polish
The Goldman Sachs Computer Hardware Index ($GHA: news,
msgs) rose 2.6 percent.
Shares of Apple Computer (AAPL: news, msgs) shined after
Merrill Lynch reinstated coverage on the PC maker with an
"accumulate" rating, coupled with a price objective of $120 per
share. The shares rose 4 1/2 to 102 1/2.
Hewlett-Packard (HWP: news, msgs) said it
will invest $32 million in high-speed Internet
provider Xcelera.com (XLA: news, msgs) as
part of an agreement to offer faster Internet
content delivery. See Tech Report.
Xcelera shares shot up 18 to 85 while H-P
rose 2.6 percent to 108 3/4.
IBM (IBM: news, msgs) rose 235/256 to 110
1/8.
Meanwhile, the Wall Street Journal reported
that Compaq may be looking to boost its
build-to-order PC offerings. Quoting
industry executives and analysts, The
Journal said, Compaq and Omaha,
Neb.-based Inacom (ICO: news, msgs) are in
talks to "turn over" some of Inacom's assembly and distribution
operations to Compaq. Compaq (CPQ: news, msgs) gained 2 7/16 to
27 9/16. Shares of Inacom fell 10 percent to 7 5/8.
Neither company would comment on the speculation, but Compaq
said it has 9,000 kiosks in retail spaces where people can
custom-configure Presario PCs. Inacom is currently one of
Compaq's distribution partners.
3Com (COMS: news, msgs) will release fiscal second-quarter
results on Tuesday, with analysts looking for earnings of 34 cents
per share. Its shares moved higher by 4 1/4 to 53 1/8.
Lucent Technologies (LU: news, msgs) was lower at 79 15/16.
Cisco Systems (CSCO: news, msgs) was up 3/4 at 104. |
