MARKET TALK: Cowen Cuts Target On Cisco, Juniper, Nortel
Edited by Thomas Granahan
Of DOW JONES NEWSWIRES
(Call Us: 201 938-5299; All Times Eastern)
MARKET TALK can be found using code N/DJMT
11:03 (Dow Jones) SG Cowen cut price targets on a number of data networking
companies, citing continued comments from firms of limited sales visibility,
back-end loaded quarters, and earnings warnings in the technology sector. SG
Cowen lowered Cisco Systems' (CSCO) price target to $37 from $47; Juniper
Networks (JNPR) to $105 from $175; and Nortel Networks (NT) to $28 from $35.
(BED)
10:58 (Dow Jones) Spot gold rally likely to continue after Friday's break of
$269/oz resistance, J.P. Morgan says. If break holds, momentum seen fueling
further gains towards $274-275/oz. At $270.05/oz. (MRL)
10:54 (Dow Jones) Well-known B2B Internet stocks slid lower Friday after
Lehman Brothers downgraded four names: Ariba (ARBA), Commerce One (CMRC),
PurchasePro.com (PPRO) and VerticalNet (VERT). All four are off at least
10%. Others in the sector fell as well, including FreeMarkets (FMKT), off
13% and i2 Technologies Inc. (ITWO), down 11%. Lehman said the macroeconomic
environment for B2B stocks has deteriorated, and that i2's acquisition of
RightWorks will only increase pricing pressures for procurement software.
(RS)
10:46 (Dow Jones) Keefe, Bruyette & Woods lowers estimate for Jefferies
Group's (JEF) 1Q earnings to 52 cents a share from 65 cents, bringing the
full-year estimate down to $2.57 from $2.70. Keefe Bruyette said the cut was
prompted by its belief that Jefferies' corporate finance business has
recently struggled along with the industry. In particular, Keefe Bruyette
noted that industrywide mergers and acquisition activity has "slowed
considerably, and we believe the company may not have escaped the wrath of
the weak market." Jefferies shares were recently off 1.1%. (GFC)
10:43 (Dow Jones) These may be the glory days for power generators,
according to an electricity supply/demand study by Deutsche Banc Alex. Brown
analyst Jay Dobson. Every region of the country will likely be short
generating capacity in this year, but about 45,000 megawatts of capacity are
on the way in '01, and close to 60,000 will be added in '02. Profit margins
for generators may peak in the first half of '02, although volume gains
should continue to drive earnings growth after that. (CCC)
10:36 (Dow Jones) Diversification really works. All types of diversified
U.S. stock funds managed to remain in positive territory in the week ended
Thursday, while sector funds that invest in health/biotech and technology
stocs continued to tumble. According to Lipper, diversified funds gained
1.66% on average, with mid-cap value funds leading the upturn with a 3.02%
gain. The 25 largest mutual funds all eked out modest gains, except Janus
Twenty, which fell 0.22% (YXH)
10:31 (Dow Jones) Bids for eBay (EBAY) shares are trailing off Friday after
Lehman Brother's analyst Holly Becker advised investors to "stay on the
sidelines" due to the online auction site's rich valuation. At an $11
billion market cap - or 119 times 2001 EPS estimates - eBay offers an
unfavorable risk-return, Becker said. (HHH)
10:24 (Dow Jones) Get them while they're out of favor, says Banc of
America's Mark Gulley. He upgraded Air Products & Chemicals Inc. (APD) to
buy, and set a 12-month price target of $52. After several years of
deterioration, the industrial gas maker's returns on capital appear to have
bottomed in 1999. With the company's new management focused on capital
discipline, Gulley sees better times ahead. (CCC)
10:21 (Dow Jones) Nasdaq Comp goes through intraday bear-market low of 2071
set March 1. Comp down 98 at 2070, DJIA off 190 at 10666. (TG)
10:14 (Dow Jones) Lehman Brothers sticking to aggressive easing forecast
post-payrolls. Firm calls for 50 BP rate cuts in March and May and 4%
mid-year Fed funds rate. (BB)
10:09 (Dow Jones) Getting lost in all the talk over the Loudcloud (LDCL) IPO
is that Goldman Sachs brought a second deal to market, an IPO for
oil-properties company Encore Acquisition (EAC). The shares recently traded
on the NYSE at $14.81, 6% above the $14 offering price, the midpoint of
price talk of $13 to $15 a share. Encore, by the way, is in the black, and
its relatively strong pricing - compared with Loudcloud's weakness -
suggests IPO investors are still favoring profitable or near profitable
companies. (RJH)
10:07 (Dow Jones) Is the policy directive in play? Barclays Capital
economists say they still expect Fed to cut rates a half point on March 20,
"but also think that the Fed will look for a way to signal that this could
be its last move. This might be accomplished by shifting to a neutral
balance of risks statement," they say. (BB)
10:04 (Dow Jones) A number of analysts recently slashed estimates for
Motorola (MOT), citing weakening fundamentals across the company's product
line. The revisions began Thursday, with Credit Suisse First Boston analyst
Tim Long cutting 2001 earnings per share projections, mainly due to handset
sales concerns. Merrill Lynch analyst Michael Ching lowered his long-term
rating Friday to accumulate from buy, citing signs Motorola's semiconductor
and handset businesses could be weakening further. UBS Warburg and ABN-AMRO
also cut their 2001 and 2002 earnings estimates. Motorola off 2%. (JDB)
9:59 (Dow Jones) Ameritrade Holding (AMTD) lowers revenue guidance. Citing
the weak stock-trading environment, the online brokerage firm now expects
net revenue of $107 million to $126 million for the fiscal second quarter
ending in March and $470 million to $600 million for all of fiscal 2001.
Previously, Ameritrade targeted $115 million to $138 million in revenue for
the second quarter and $570 million to $650 million for fiscal 2001. The
stock is off 4.7%. (GFC)
9:54 (Dow Jones) That the market set so low of a value on Loudcloud (LDCL)
means that investors just aren't buying stocks simply because of who runs
the company, in this case former Netscape founder Marc Andreessen. Investors
realized that "this was not an employee going public, this is a company
going public," says Ben Holmes, president of ipoPros.com. (RJH)
9:45 (Dow Jones) "The pieces are coming together" for Watson Pharmaceuticals
(WPI), says SG Cowen analyst Ian Sanderson, who initiated coverage of the
drug maker with a buy rating and a 12- to 18-month price target of $65. He
cited Watson's diversified drug line with generics and designer
pharmaceuticals. He forecasts strong earnings growth in 2001-02, resulting
from robust new drug rollouts coming to the fore. He also expects the brand
drug franchise could grow to account for 58%-60% of total sales and 60%-65%
of earnings-per-share by 2004. (BMM)
9:41 (Dow Jones) June Nasdaq's early weakness causes market to fall to its
65 point limit down, hitting 1909.50, at 9:34 a.m. ET. A 10-minute trading
curb is in effect. If the markets remain at limit down, at 2-minute trading
halt will occur. (DMC)
9:37 (Dow Jones) Add another SEC investigation to the list of online
retailer Amazon.com Inc.'s (AMZN) problems. The New York Times reported
Friday that Amazon CEO Jeff Bezos is the focus of an SEC probe about stock
sales he made after Amazon received an advance copy of a scathing research
note by Ravi Suria. The feds were already looking at the way Amazon accounts
for and discloses its partnerships with other e-commerce outfits. Amazon
stock down 3%. (RS)
(END) DOW JONES NEWS 03-09-01
11:04 AM
*** end of story *** |
