NETWORK SOLUTIONS Stock Surges on Earnings Report
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NEW YORK (Reuters) - Shares of Network Solutions Inc. (NasdaqNM:NSOL - news) surged on Thursday after the world's leading registrar of Web addresses reported first-quarter earnings that topped Wall Street forecasts by a wide margin.
Network Solutions, set to be acquired by Web security firm VeriSign Inc. (NasdaqNM:VRSN - news) in a $17 billion deal, said explosive global demand for Internet domain names fueled a 206 percent rise in first-quarter income.
Wall Street applauded the results, sending the stock up 17 1/8 to 132 1/2 in afternoon trade on the Nasdaq stock market.
``In the first quarter, we saw astounding acceleration in dot-com, dot-net and dot-org domain registrations worldwide,'' Network Solutions Chief Executive Jim Rutt said in a statement.
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He said new registrations totaled 5 million in the first quarter, up 120 percent from the 1999 fourth quarter.
The Herndon, Va., company reported first-quarter net earnings of $14.7 million, or 20 cents a share. That compared with $4.8 million, or 7 cents per share, in the first quarter of 1999.
Wall Street analysts, on average, had expected earnings of 14 cents per share, according to research firm First Call/Thomson Financial.
Revenues rose to $98.2 million from $38.1 million in the year-ago quarter.
In March VeriSign agreed to buy Network Solutions for $17 billion in stock. It was the most expensive acquisition of an Internet company and is expected to close in the third quarter.
Ulric Weil, an analyst with Friedman, Billings, Ramsey in Arlington, Va., said Network Solutions' first-quarter results raised the question of whether the company had sold itself too cheaply.
``It's just astounding what came through in the first quarter,'' he said.
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