RECAP & STOCKS TO WATCH FOR FRIDAY, 2-16-01
Technology stocks rose for the second straight day, as most sectors, especially fiber-optic and networking shares, jumped on the heels of a better than expected earnings report and raised guidance from Ciena Corp. (CIEN). The chip stocks added to Wednesday’s gains as the Semiconductor Index (SOX) added another 4.9%.
The Nasdaq Composite rose 61 points to close at 2,552. Volume was 2.1 billion shares, with advancers beating decliners by 22 to 15. Blue chips rallied with the techs as the Dow added 95 points to finish at 10,891. Volume on the Big Board was 1.1 billion shares with advancers beating decliners by 17 to 14.
From a technical standpoint, support on the Nasdaq Composite gapped up over 2,500, with resistance at 2,660-2,700. The DJIA is resting on its 20-day Moving Average with next support at 10,700, and resistance at 11,000. The Semiconductor Index (SOX) pushed through resistance at 700 with new resistance in the 760 area.
Nortel Networks (NT): Company warned for Q1, seeing loss of $0.04 vs est. of $0.16 and revenues of $6.3 bln vs $8.1 bln estimate. In addition, NT will be cutting up to 10,000 jobs this year, or 11% of its workforce. That figure includes the 4,000 job losses announced in early January. John Roth, President and CEO, said "While we previously noted that economic uncertainties and capital constraints were impacting our outlook, we are now seeing a faster and more severe economic downturn in the United States, which we now expect will result in a slower overall market growth of approximately 10% in 2001. We now expect the U.S. market slowdown to continue well into the fourth quarter of 2001." Customers of NT that could be affected: communications ICs: AMCC, PMCS, TXCC, VTSS. Wireless: PWAV, EMS. Companies that do business with NT: ACTM, EMS, SANM, SCI, SLR. Competitors in telecom/networking/optical components: CSCO, LU, JDSU, GLW.
Dell Computer (DELL): Reported Q4 earnings of $0.18 a share, $0.01 worse than the First Call consensus of $0.19, vs year-ago earnings of $0.16. Revenues rose 27.5%, to $8.67 bln from a year-ago of $6.80 bln. On conference call, company said it is bullish about its current position, but the uncertain macro-economic environment has restricted it to providing guidance for Q1 only. Believes operating margins in Q1 will be flat with Q4 levels, and again, states that it expects Q1 EPS of $0.17 per share and revenues of $8.0 bln.
Hewlett-Packard (HWP): Reports Q1 earnings of $0.37 a share, in line with the First Call consensus of $0.37, vs year-ago earnings of $0.40; revenues rose 2.4% to $11.95 mln from a year-ago of $11.67 mln.
Analog Devices (ADI): Reported Q1 earnings of $0.50 a share, in line with the First Call consensus of $0.50, vs year-ago earnings of $0.25. Company warned for Q2, seeing EPS of $0.43-0.44 vs First Call est. of $0.48, and revenues to be in the range of $710 to $725 mln.
Novell (NOVL): Reported Q1 earnings of $0.01 a share, $0.01 better than the First Call consensus of $0.00, vs year-ago earnings of $0.13. Revenues fell 22.5%, to $245.04 mln from a year-ago of $316.04 mln.
Agile Software (AGIL): Reports Q3 earnings of $0.01 a share, $0.01 better than the First Call consensus of $0.00. Revenues rose 192.2% to $25.02 mln from a year-ago of $8.56 mln.
Riverstone Ntwrks (RSTN): IPO prices 10 mln shares at $12, within the revised range of $11-$13 and at the low end of the initial range of $12-$14. Company is a spin off from Cabletron Systems (CS) and a provider of Internet infrastructure solutions. |
