DJ MARKET TALK: Worm Turning For Cisco?
22 May 11:46
Edited by Thomas Granahan
Of DOW JONES NEWSWIRES
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11:44 (Dow Jones) The outlook for Cisco (CSCO) is brightening, and its stock
is likely to inch up in response, say two Wall Street analysts Tuesday. Credit
Suisse First Boston analyst Lissa Bogaty said a meeting with Sanjay Pol of
Cisco's optical division revealed that one or more large contract wins, which
the company has alluded to previously, could start shipping this quarter. Pol
told her carriers are "turning spigots back on a little." Meanwhile, SG Cowen
analyst Christin Armacost is "cautiously optimistic" after a meeting with
Cisco's finance chief Larry Carter. Tactical issues have been largely addressed
and Cisco is focused on executing. (RR)
11:38 (Dow Jones) Shares of competitive carrier Time Warner Telecom (TWTC)
have become overpriced in the last two weeks, says UBS Warburg. Analyst Glenn
Waldorf ties the stock's recent ascent to reports that Cable & Wireless (CWP)
may be a suitor. Waldorf argues that the stock is overvalued for potential
suitors and for investors. (CBN)
11:34 (Dow Jones) The euro is really taking it on the chin in New York and
continues to lose ground across the board. EUR/USD low for the year is now
$0.8648. The euro/yen cross has fallen to Y106.11. USD/JPY is at Y122.60;
EUR/USD is at $0.8657. (JRH)
11:29 (Dow Jones) Bear Stearns analyst Jason Ader raised his fiscal 2002
earnings estimate on International Game Technology (IGT) to $3.15 a share from
$3.00, citing the rising installed base of MegaJackpot games on IGT's
progressive slot machine system. Reiterating his buy rating, the analyst
expects the stock to reach $78 to $80 a share in the next six to 12 months.
Shares of IGT reached $63.50 Tuesday, above the 52-week high of $63.30 set
Monday. (DDO)
11:18 (Dow Jones) Senate Banking Chairman Gramm says he's"still praying
over" what, if anything, to do about Fannie Mae (FNM) and Freddie Mac (FRE). He
also says "it scares me that whatever I say can change the way people invest
their money." (JC)
11:13 (Dow Jones) Morgan Stanley Dean Witter analyst Robert Stevenson
downgrades Gables Residential Trust (GBP) to neutral from outperform based on
valuation. Since the stock, which recently traded at $28.12, is approaching
Stevenson's $30 price target, the analyst believes it's a good time to take
some profits. The company's prospects for continued rent and occupancy growth
"are likely to remain weak over the next few quarters" due to "challenging
fundamentals in several of Gables' markets," Stevenson added. The analyst is
maintaining his 2001 funds from operations estimate of $3.14 a share, which is
slightly below the Thomson Financial/First Call consensus of $3.16 a share.
(JKM)
11:02 (Dow Jones) McAfee.com (MCAF) shares soared as news of a new strategic
alliance with Microsoft (MSFT) hit the market. The anti-virus company will be
integrating Microsoft's Passport and HailStorm technology into its security
services. The stock jumped more than 50% on the news. (MCAF)
10:51 (Dow Jones) Quote higher than 96.125 (mid-point) in July Fed funds
would show market expectations leaning to 25 BP rate cut at June Fed meeting,
broker says. Contract slightly higher, last at 96.135. But much of market in
holding pattern until more economic data are released ahead of June meeting, he
says. (SPC)
10:42 (Dow Jones) PIMCO's Bill Gross says next economic upturn is "almost
certain to be less exuberant than the last" and that investors have been shaken
out of their belief that stock investments are "a one-way winning lottery
ticket." (JC)
10:35 (Dow Jones) No. 1 sector to the good in an otherwise sideways market is
footwear, up 2.8% as a group and led by Nike (NKE) and Reebok (RBK), after the
latter had annual analyst meet Monday in Boston. UBS Warburg upped its 12-month
target forRBK to $34 from $31 and maintained a buy nod. UBS' Jeff Edelman
hoping for "impressive financial performance over the next several years," and
he likes licensing deal with NFL. However, Nike's inventory mismanagement could
cause pricing issues for footwear makers in near term. (GC)
10:32 (Dow Jones) Current rally in stocks may be getting long in the tooth,
says Hilliard Lyons technician Dick Dickson. Sees overbought readings in his
momentum indicators, growing levels of bullishness and notes the equity
put/call ratio hit a new overbought extreme Monday. Meanwhile, the VIX is
approaching levels that marked the top of the recovery rally in February. Taken
together, he's not comfortable about chances for significant rally further, and
cautions about chasing stocks. (TG)
10:15 (Dow Jones) The fact the ECB would risk cutting rates for growth
reasons, while inflation is rising, would be like double punishment for the
euro, which fell to a year-low this session, Bear Stearns says. (ELS)
10:04 (Dow Jones) Nasdaq gives up early gains, and blue-chips remain
moderately weaker. Semis and biotechs, among biggest winners of late, giving up
ground, though nothing dramatic. Computers and banks act OK, and tech
components of DJIA higher. DJIA off 31 at 11305, Nasdaq flat at 2305, and S&P
500 eases 2 to 1310. (TG)
9:58 (Dow Jones) AOL Time Warner's (AOL) flagship online service will raise
its monthly fee for unlimited use to $23.90 from $21.95. The move was generally
expected sometime this year. AOL executives have hinted an increase was an
option, although they denied analysts' suggestions that the hike's purpose was
to help AOL meet its ambitious 2001 financial targets. Still, a
back-of-the-envelope calculation shows AOL would bring in an extra $339 million
in revenue in 2001 as a result of the increase. Every bit counts when you're
trying to reach $40 billion for the year. (PDL)
(END) DOW JONES NEWS 05-22-01
11:46 AM |
