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Nasdaq Extends High In Lighter Volume New Issues Rambus, Omniquip, Twinlab Set Record Closes
Date: 6/17/97
Author: C. Kinou Treiser
The Nasdaq Stock Market rose moderately higher to another record close yesterday as technology stocks racked up solid gains.
The Nasdaq composite index gained 8.92 points, or 0.6%, to 1431.95. It was the composite's fourth increase in a row. Advances led 2,102 to 1,977. But volume slid 16% to 500 million shares.
By comparison, the NYSE composite index slipped 0.03% and the Amex composite 0.31%, or 1.93 points, to 628.17.
NASDAQ, AMEX MARKETS
Among large caps, Intel Corp. rose 2 1/2 to 147 1/4, Microsoft Corp. 1 3/4 to 131 3/8, a new closing high, Cisco Systems Inc. 7/8 to 67 1/2, and Tellabs Inc. climbed 3 5/8 to 52 1/4. Alex. Brown Inc. upgraded the maker of telecom gear to ''strong buy'' from ''buy.'' The stock has rallied 20% in the past four days.
Dell Computer Corp. advanced 4 1/4 to 115 3/8 - 1/4-point short of its closing high. Dell hired Novell Inc. president Joseph Marengi as senior vice president in charge of large and medium- sized corporate accounts.
ESC Medical Systems Ltd. soared 4 to 26 1/2 on double its average volume. Smith Barney Inc. reported that the company last week gave the FDA additional data on its EpiLight hair-removal product.
''The data proves that Epilight is very safe and, based on publised information, safer than the ruby lasers,'' now used for hair removal, analyst Mary Austin said. ''It seems very likely that they'll get marketing clearance soon.'' ESC originally applied for FDA approval on EpiLight in the fall. Smith Barney had been hoping it would get clearance in February or March. The stock had fallen as much 50% in the interim.
Rambus Inc. jumped 3 to 36 1/4, a new high on less-than-average volume. The Mountain View, Calif., company licenses technology that enhances computer performance. It's expected to report its first profit this year of a nickel a share; analysts are looking for 20 cents in '98, according to First Call. Sales growth over the past five quarters has accelerated from 39% to 54% to 83% to 119% to 132%. The stock has tripled since coming public a month ago.
Several other small-cap companies that recently debuted also scored big gains. Omniquip International Inc. rose 2 5/8 to 22 1/8 on double its normal trade. The company makes construction lifts that can raise up to 10,000 pounds of concrete five stories high. Earnings are expected to rise 30% in the year beginning in September. The company has had triple-digit sales growth for two quarters. The stock came public at $9 a share in March. Twinlab Corp., which came public at 12 in November, jumped 2 1/8 to 19 on triple its usual activity. The maker of nutritional supplements is expected to increase earnings 31% this year and 27% next.
Apollo Group Inc. climbed 1 7/8 to 39 5/8, a new high on slightly more than average volume. The provider of higher-education programs has boosted earnings growth from 50% to 56% to 67% over the past two quarters. The stock is up 50% since it began rallying with the market in late April.
Spectrian Corp. shot up 3 1/4 to 31 1/8 on triple its normal trading. The maker of gear used in wireless communications is up 20% in the past week on speculation the company will exceed fiscal first-quarter estimates of 35 cents a share. It had a loss of 66 cents in the year-ago period. Spectrian traded as high as 51 1/4 in August '95 but fell as low as 7 last July after reporting the first of two losing quarters.
STB Systems Inc. gained 2 5/8 to 37. Stock of the maker of computer-graphics adapters will split 3 for 2 on July 17. Earnings are expected to rise 61% for the year ending in October and another 36% in fiscal '98. The stock began trading at $12 a share February '95. It set a high of 40 1/4 on May 23, on low volume, and was turned back to 30 the following week.
Complete Business Solutions rose 2 7/8 to 25 3/4. Volume was 38% higher than usual. Scana Corp.'s South Carolina Electric & Gas utility has hired the company for Year 2000 conversion. The value of the contract wasn't disclosed. Complete Business shares came public at $12 on March 5. Among other Year 2000 stocks, Micro Focus Group PLC gained 7/8 to 30 3/4, Viasoft Inc. 2 1/4 to 52 1/2 and Zitel Corp. 2 to 20 3/8.
McLeod Inc. gapped ahead at the open and bolted 4 3/8 to 28 7/8 on seven times its normal volume. The provider of telecom services will buy privately held Consolidated Communications Inc. for about $420 million. It's McLeod's third buyout in the past 12 months.
Quickturn Design Systems Inc., a maker of systems used in chip design, climbed 2 7/8 to 15 7/8 on four times its usual activity. Morgan Stanley & Co. raised its rating to ''outperform'' from ''neutral'' after Quickturn entered into a service agreement with Synopsis Inc., also a provider of chip-design gear. Quickturn will provide consulting and turnkey services to Synopsis customers.
Very thinly traded Universal Manufacturing Co. jumped 4 to 17 1/4 on 11,200 shares. It normally trades less than 1,000. The maker of auto and truck parts has an Earnings Per Share rank of 90. The stock's tripled since coming public in April '94.
On the downside, Amex-listed Viacom Inc. fell 1 1/8 to 33 5/8, breaking the stock's nine-session win streak from 29 1/2.
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(C) Copyright 1997 Investors Business Daily, Inc.
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