This better be good ---> AMZN going to dazzle & dilate reorter's eyes on monday
Also recap of Briefing afterhours:
Amazon.com (AMZN) 16.94 +0.45 (+2.7%): Sources at DB Alex. Brown telling us that AMZN is hosting a small marketing event in New York on Monday. Firm has discovered that AMZN has invited as many as 80 reporters. Notes that AMZN historically has used these types of events to make major announcements.
15:53 ET Ulticom (ULCM) 21.00 -1.44 (-6.4%): Coming under pressure amid trading floor talk of damaged relationship between ULCM and customer Sonus (SONS).
15:43 ET Cymer (CYMI) 24.72 -1.99 (-7.5%): -- Update -- Trading in stock resumed.
15:34 ET ONI Systems (ONIS) 22.75 -3.01 (-11.7%): Stock being hit by news that Williams Communications has sold 1.6 mln shares of ONIS stock. WCG is a major ONIS customer. Editor's note: this comment originally reported that Williams' CTO Matthew Bross sold the 1.6 mln ONIS shares; that was incorrect. Williams Communications sold the shares, not Mr. Bross.
15:18 ET Cymer (CYMI) 25.88 -0.83 (halted): Semiconductor equipment maker expects Q2 revenues to come in at the lower end of previous guidance and earnings should meet or exceed analysts' estimates for the qtr. However, expects Q3 operating results to fall substantially below Q2; anticipates loss for Q3 (consensus $0.00).
15:13 ET Microsoft (MSFT) 71.88 +0.28 (+0.4%): -- Update -- Hearing from traders Bloomberg is reporting that the DOJ has asked Appeals Court to Fast Track the Microsoft case; news being viewed as a slight positive.
15:09 ET Rumor Mill : ImClone Systems (IMCL 46.15 +4.54) being eyed as takeover candidate, with possible interest from SGP and MEDI... IBM Corp (IBM 107.73 +0.48) could announce a major round of layoffs early next week... Lexmark (LXK 60.66 -0.25) may close manufacturing facility for short time in attempt to trim costs.
14:51 ET SERENA (SRNA) 26.15 -3.35: Hearing from sources at Wit SoundView that the firm made comments about a Gartner Group conference call on software; on the call, the Gartner analyst reportedly said that SRNA appears mixed with inquiries up but not close rates; Wit SoundView apparently expresses caution on SRNA short-term as there is still business to close for the July qtr and the stock tends to weaken into its quarterly report. Stock has already recovered a bit off the 25.30 low.
14:49 ET Guidant Corp (GDT) 30.04 +2.05 (+7.3%): -- Update -- Has made an impressive run after company reports positive meeting with FDA. Merrill Lynch thinks while too early to gauge the timing implications of these meetings, finds it encouraging that FDA is at least willing to give Guidant a hearing. Additionally, firm thinks that GDT may have some "tasteful" upside relative to expectations when it reports on Tuesday. Also making rounds is talk that MDT is interested in making a bid for GDT. However, rumor is being met with skepticism.
14:26 ET EchoStar (DISH) 29.26 -0.84 (-2.8%): -- Update -- CE Unterberg comments on Bloomberg story that jury found EchoStar to be intentionally infringing against three patents held by IPPV and awarded $15 mln, with potential for damages to grow to $45 mln. Firm does not view potential $45 mln award as particularly damaging to DISH; would expect company to come to licensing agreement with IPPV for future use of technology.
14:10 ET PacifiCare Hlth (PHSY) 20.95 +3.11 (+17.4%): Heavily shorted healthcare services stock running on rumor company will preannounce to the upside.
13:57 ET NTL Inc (NLI) 8.00 -1.36 (-14.5): In response to recent volatility in the share price, company reaffirms that it will meet or exceed previously announced guidance for Q2 and 2001.
13:53 ET EchoStar (DISH) 29.06 -1.04 (-3.5%): Hearing that jury has ruled against DISH in patent case, finding that company intentionally infringed 3 pay-per-view patents related to IPPV. Company may ask Judge to triple jury award; traders citing Bloomberg.
13:27 ET Sector Watch: Networking : Cisco (CSCO) has been strong from the outset on brokerage firm comments that it was winning back router share from Juniper (JNPR); JNPR nevertheless doing well as it was able to keep forward guidance relatively intact; optimism surrounding these stocks has spilled over into comm IC group, where AMCC (+7.1%) and PMCS (+8.8%) are making big moves. There has been some talk that CSCO orders might resume, though it's unclear if this is just a reaction to the positive CSCO talk today or a specific rumor; CSCO is a major customer of both AMCC and PMCS.
13:13 ET Intraday Developments : -- Technical -- Siebel Systems (SEBL 47.34) has spent the majority of the session drifting sideways to work off the overextended technical posture. Intraday support is at 47/46.8, while intact well positioned for an afternoon upside extension
13:07 ET Guidant Corp (GDT) 28.65 +0.66 (+2.3%): -- Update -- Issues press release stating that it can provide the data and analysis requested by the FDA as early as July 20.
12:50 ET Chiron (CHIR) 47.15 +1.85 (+4.1%): Follow-up to CHIR rumor yesterday. In note released last night, Merrill Lynch pushed out expected FDA approval of NAT blood testing product to Q4 from previous estimate of Q3. As a result, firm reduced 2001 NAT rev. est. to $43 mln from $66 mln and EPS est. to $0.85 from $0.87. Numbers for 2002 remain unchanged.
12:31 ET Potential Setups : -- Technical -- Recent rally has positioned a number of tech stocks (see 11:57 comment/QCOM yesterday) for a test of bearish trendlines. Currently bumping up against such resistances are INTC (near 30.2) and BRCM (near 43.8). Short term indicators are a concern given the overbought posture but sustained breaks increase the probability of a run at their respective trading range tops over the medium term.
12:22 ET Guidant Corp (GDT) 28.30 +0.31 (+1.1%): Reuters reports that GDT calls meeting with FDA constructive; congestive heart failure device is under expedited review.
12:13 ET Peregrine Sys. (PRGN) 27.95 +0.25 (+0.9%): Intraday spike on news Compaq Global Services will incorporate Peregrine's IT asset management (ITAM) solutions in its portfolio of service offerings.
12:12 ET Alcoa (AA) 41.52 +0.79 (+2%): Company's board of directors authorizes the repurchase of 50 mln shares of Alcoa common stock; replaces similar buyback under which approx. 32.2 mln shares were purchased.
12:04 ET Adobe Systems (ADBE) 40.38 -2.56 (-6%): -- Update -- Hearing from sources at UBS Warburg that firm thinks Apple (AAPL) situation is overblown. ADBE decision not to take a booth at Macworld is consistent with company's absence from other recent tradeshows in an effort to reduce sales and marketing costs. With respect to competing Photoshop product, believes that even if Apple releases its own photo editing application, Photoshop is embedded in the culture and workflow of Mac designers. Estimates that Photoshop sales to apple represent 12% of ADBE's top-line.
11:57 ET Cisco Systems (CSCO) 18.75 +0.89 (+4.9%): -- Update -- Technical -- Another large cap tech stock on the mend as it recently edged past a trendline off the May/late July highs. Initial resistance is at the 50/100 day simple ma (19.1) followed by 20. Breakout/penetration here coupled with the bullish dailies increases the probability of a more sustained rally.
11:44 ET Sector Watch: Biotech : Impressive upside performance today as this beleaguered sector recoups some of the substantial losses posted over the two weeks. Leading the way higher are: AFFX (+9.8%), HGSI (+8.9%), GILD (+6.7%), MLNM (+6.1%), IDPH (+6%) and PDLI (+5.5%).
11:41 ET Lucent Tech (LU) 7.21 +0.35: Stock relatively strong today; in addition to a mildly positive note from UBS Warburg this morning, there is also trading floor talk that the sale of the fiber optic division might be announced by Monday.
11:35 ET SouthBanc Shares, Inc. (SBAN) 25.00 +0.85 (+3.5%): In discussions with a regional bank holding company to be acquired for $28 per share in cash/stock. Stock currently halted.
11:23 ET Wright Medical (WMGI) 15.05 +2.55: -- Update -- IPO opened for trading at $15.31, after pricing at $12.50. Intraday range $14.80-$15.50.
11:15 ET Harleysville Nat'l Corp. (HNBC) 43.99 +0.22 (+0.5%): Bank holding company declares a 2-for-1 stock split payable Aug. 10.
11:12 ET Adobe Systems (ADBE) 41.83 -1.11 (-2.6%): CNET reports that company is skipping the Macworld Expo. In interviews company said that its absence should not be seen as a slap at Apple and denied any rift between the companies. However, hearing from trading floor contacts that there is chatter AAPL is rolling out a competing version of PhotoShop and will not port it with the new OS. Not helping matters is rumor that ADBE's chairman has been selling stock.
11:00 ET American Eagle (AEOS) 39.90 +0.35 (+0.8%): -- Technical -- Stock hit after early failure at its near two month trading range top at 40 (also Jan/Feb highs) but is again climbing higher. If barrier is broken initial resistance comes in at 40.50 and 41. Secondary resistance is at 41.55/41.83.
10:46 ET Sohu.com (SOHU) 1.78 +0.15 (+9.2%): Shares of China Internet portal also being picked up by momentum players. Contributing to interest is news out Wednesday that company's CEO is serving as the Deputy Chairman of Beijing's Olympic Delegation. According to the CEO, a successful bid would mean the Chinese government would spend $20 bln modernizing the city's infrastructure, including sports facilities, transportation systems and telecom networks.
10:29 ET Harley-Davidson (HDI) 50.08 +0.33 (+0.6%): -- Technical -- Edges past the top of its near two month trading range near 50 initial resistance is at its 52 wk high of 50.63.
10:22 ET Olympics Plays : Traders piling into the old China WTO plays on news of Olympics win. Stocks to watch include Qiao Xing (XING 3.31 +0.18), China.com (CHINA 3.20 +0.23), SINA.com (SINA 1.80 +0.08), US-China Industrial (CHDX 12.8 +0.3), UTStarcom (UTSI 24.99 unch).
10:13 ET Beijing Gets Olympics : International Olympic Committee awards Beijing the 2008 Olympic Games.
10:02 ET Nasdaq Composite : Bounces off short term support in early trade near 2060 but has recently penetrated. This level and 2069 are important keys for the bulls today. Initial supports are located at 2052 and 2040/37.
10:00 ET Manhattan Assoc (MANH) 29.15 -2.45: Stock getting hit by a CFRA (Center for Financial Research and Analysis) report which claims that revenue growth was probably weaker than reported absent the effect of a recent acquisition, operating cash flow deteriorated, and EPS benefitted from a lower allowance for doubtful accounts and lower tax rate.
09:59 ET Marine Drilling (MRL) 15.00 -0.20 (-1.3%): According to ABN AMRO, a rig owned by MRL exploded in the Gulf of Mexico. Given deterioration in the jackup market since company signed agreement to merge with Pride International, thinks Pride may use this rig explosion as the catalyst to change the terms. If this were to happen (firm estimates probability 20-25%), the gap between PDE and MRL would probably widen.
09:54 ET Xerox Corp (XRX) 8.51 +0.17 (+2%): Trades up on WSJ report that company may have adopted more conservative accounting amid an SEC probe into company's past bookkeeping practices.
09:52 ET Economic Data : -- Update -- University of Michigan preliminary July sentiment reading reported at 93.7 which is above both the consensus and the previous report of 92.6.
09:47 ET Sector Watch : Losses relatively modest thus far but a number of tech sectors (semiconductor, Internet, networking, software, computer-hardware, telecom) are in the red. Also posting losses this morning are oil service, natural gas, retail, gold and broker/dealer. On the plus side are biotech, healthcare, drug and banking.
09:41 ET FEI Company (FEIC) 36.80 +2.10 (+6%): Gaps up on news company to replace Sawtek in the S&P MidCap 400 Index; FEIC will be added after the close of trading July 19.
09:40 ET Juniper Networks (JNPR) 28.91 +0.44: -- Update -- On conference call last night, Juniper said that it will announce a new European PTT customer win next week; the trading floor talk this morning is that British Telecom (BTY) is the PTT in question.
09:40 ET Siebel Systems (SEBL) 46.84 +2.10 (+4.7%): -- Update -- Technical -- Gaps higher once again but being stymied thus far by gap resistance in the 47.13-47.50 area. Is running a little hot short term (up as much as 18% off Wednesday's low) but momentum continues to underpin. A secondary resistance comes in at 48/48.3. Potential for intraday profit taking near these ceilings but daily posture remains in the bullish camp.
09:37 ET Gapping Up : After several says on the defensive, seeing early strength in the genomics sector out the gate: AFFX (+4%), CRA (+2.8%), HGSI (+2.8%), PDLI (+2.5%).
09:30 ET Microsoft (MSFT) 71.39 -0.21: -- Update -- Though the stock didn't benefit after hours yesterday, there is some talk this morning about the settlement between MSFT and the state of New Mexico. Though 18 other states have not settled, the breaking in the ranks is seen by some as notable.
09:27 ET Centra Sftwre (CTRA) 16.66: Needham downgrades to BUY from Strong Buy and cuts price target to $19 from $25; says there is more risk to estimates than previously believed, especially in Q4 when company will need a 41% sequential revenue increase to hit Needham's estimate.
09:20 ET Kohl's Corp (KSS) 59.45: Jefferies downgrades to HOLD from Accumulate, citing valuation and concerns about company's ability to continue to generate traditional "Kohl-like" comps in Q3 and Q4.
09:16 ET Manugistics (MANU) 24.71: First Union makes comments ahead of July 16 analyst meeting; says that there is room for a downward revision to Aug qtr revenue guidance; hearing from sources at First Union that the firm noted lack of any recent guidance changes despite the difficult business environment, and recent insider sales.
09:03 ET Intel (INTC) 30.10: -- Update -- Hearing from sources at Robertson Stephens that the firm is cautious on Intel following AMD's report; says they will be cutting prices on Pentium 4 to reduce inventory as product has not been selling well; sees company losing share to AMD and expects margins to be squeezed by lower selling prices.
09:00 ET Gapping Up/Down : ADSX +25% (awarded $12 mln contract, with potential of $45 mln)... CCRT +12% (expects to exceed estimates)... EFII +5% (beats consensus by 2 cents or 8%)... SEBL +6% (contract rumors; positive comments by analyst)... JNPR +4% (tops EPS forecast; Robbie upgrade)... ELNK +3% (CIBC starts with Strong Buy)... Gapping Down: RSAS -24% (downgrades, estimate cuts)... RMBS -12% (warning)... PWAV -8% (guides lower).
08:50 ET Juniper Networks (JNPR) 28.47: -- Update -- Hearing from sources at Wit SoundView that the firm believes that despite management denials, Juniper has lost some market share; Salomon Smith Barney made similar comments this morning (see 7:24 comment).
08:50 ET CompuCredit (CCRT) 10.64: After the close, company announced that it expects to earn $0.30-$0.32 a share for the qtr (consensus $0.25).
08:45 ET USX-U.S. Steel (X) 20.55: Analysts expecting company to post a Q2 loss of between $0.50 and $1.06, with a median estimate of -$0.72. USX announces that it anticipates a loss closer to $0.50.
08:38 ET Siebel Systems (SEBL) 44.74: Sources at Morgan Stanley telling Briefing.com that the firm made positive comments on SEBL this morning; thinks SEBL will not pre-announce.... Seperately we are hearing that SEBL won a $50 mln contract with a UK telecom company, but turned down a deal with Verizon (VZ) due to unacceptable pricing, which is being interpreted as a sign that the company is still strong enough to resist pricing pressure. We have not confirmed this.
08:35 ET Opening Indications : Futures trading is showing no significant reaction to the economic data. S&P futures at 1213, trade one point under fair value while Nasdaq 100 futures at 1758, trade five points below fair value.
08:33 ET Economic Data : Retail sales rose 0.2% in June vs the 0.3% consensus, with ex-auto sales falling 0.2% vs consensus of +0.2%; PPI fell 0.4%, but the core increase of 0.1% was in line with expectations. The Retail Sales number is the more important figure today, with the unexpected weakness in ex-autos sales likely to create more pessimism concerning consumer spending.
08:30 ET Toys R Us (TOY) 25.15: Company expects to post a Q2 loss of at least $0.14 a share (consensus loss of $0.07) and sees annual earnings falling slightly short of current consensus estimates; comments made in a 8-K filing with the SEC.
08:28 ET CSFB Initiations : CSFB initiates coverage on Finisar (FNSR) and Corning (GLW) with HOLD ratings and resumes coverage of JDS Uniphase (JDSU) with a HOLD; says FNSR's quarter may be at risk, GLW's fiber/cable business is deteriorating and company will need to take down numbers again, and JDSU won't recovery until late 2002.
08:22 ET Rational Sftwr (RATL) 20.49: Morgan Stanley initiates with a NEUTRAL rating; says reliance on tech and telecom vertical markets could dampen outlook more than consensus anticipates, and that stock is trading above estimated intrinsic value of $16.04.
08:22 ET Weatherford Intl (WFT) 40.48: First Union thinks company's earnings report on Monday could provide needed relief; expects company to report solid EPS and conduct an upbeat conference call; does not think company has experienced any slowdown in its N. American operations and that earnings visibility for the next couple of qtrs is good.
08:15 ET Pharmacopeia (PCOP) 17.50: SG Cowen downgrades to BUY from Strong Buy due to earnings uncertainty; reduces 2002 est. to $0.68 from $1.05 and 2003 to $0.92 from $1.35.
08:12 ET EarthLink Ntwrk (ELNK) 14.60: CIBC World Markets initiates with STRONG BUY and $20 price target; says shift from narrowband to broadband will deliver higher revenues and margins; notes that company might be a great fit for Microsoft's (MSFT) MSN, and has great balance sheet with $5 per share in net cash.
08:06 ET Opening Indications : Futures activity carries a modestly negative bias. S&P futures at 1213, trade one point below fair value while Nasdaq 100 futures at 1755, trade eight points under fair value.
08:05 ET Capstone Turbine (CPST) 19.05: Department of Energy Secretary Spencer Abraham announced a $3 mln award to Capstone for the "research, development and testing of packaged cooling, heating and power systems for buildings."
08:03 ET New York Times (NYT) 41.30: Bear Stearns upgrades to BUY from Attractive with a $53-54 price target; cites meaningful cost control measures which will translate into a meaningful bounce when recovery occurs. Bear also downgrades EW Scripps (SSP 69.39) to ATTRACTIVE from Buy, primarily due to valuation.
07:55 ET VISX (EYE) 16.39: Banc of America Sec. lowers FY01 est. to $0.80 from $0.85 and FY02 to $0.91 from $1.00; believes shares are fully valued given negative growth and poor EPS visibility.
07:51 ET Level 3 Comms (LVLT) 3.94: Goldman Sachs conversations with management lead firm to believe that LVLT's potential funding gap can be filled by reducing capex to the volume of business generated.
07:48 ET AT&T Wireless (AWE) 16.42: ABN AMRO reiterates Buy rating; says AT&T's completion of 94.5 mln shares has virtually eliminated firm's shareholder "churn" concerns. Firm expects a strong Q2 report with 670,000 net adds, ARPU of $61.25, churn of 3%, service revenue of $2.995 bln and EBITDA of $790 mln.
07:39 ET Juniper Networks (JNPR) 28.47: -- Update -- Robertson Stephens upgrades to STRONG BUY from Buy on view that JNPR has the potential to dominate the market. Notes that shares are not cheap and firm may be early with its recommendation, but believes stock is a franchise name; would rather be early than late with this recommendation.
07:33 ET Opening Indications : This morning's fair value figures -- S&P 500 fair value:1214; closed at fair value. Nasdaq 100 fair value: 1763; closed 2 pts below fair value. Current indications: S&P 500 futures are -1.1, or 1.1 pts below fair value. Nasdaq 100 is -2.0, or 4 pts above fair value... Focus will continue to be on earnings, with JNPR expected to provide leadership, while investors in the security sector digest RSAS' disappointing numbers. Latin American default concerns could make investors jittery going into the weekend.
07:24 ET Cisco Systems (CSCO) 17.86: In note discussing JNPR's results, Salomon Smith Barney speculates that CSCO may be seeing better near term results in its GSR line and may be picking up share as growth shifts to the metro market from the long haul core.
07:16 ET RSA Security (RSAS) 29.95: DB Alex. Brown downgrades to MKT PERFORM from Buy based on industry growth deceleration and no expectation of near-term macroeconomic recovery. Firm reduces FY01 est. to $0.53 from $0.76 and FY02 to $0.64 from $1.05.
07:12 ET Business Week Stocks : Amerada Hess' purchase of Triton Energy has raised speculation that Ocean Energy (OEI 17.70) will be acquired; pros think stock worth $25-$30 in a buyout... Teva Pharmaceutical (TEVA 63.34) considered a good way to play both generic and branded drugs; rising number of drugs coming of patent provides "tailwind" for company's growth... American Greetings (AM 11.11) viewed as a turnaround play whose stock could double in a year.
07:04 ET Advanced Micro (AMD) 22.70: Lehman reduces CY01 estimate to $0.35 from $0.62 and CY02 to $0.80 from $0.95. Firm feels that there is further risk to EPS as international markets deteriorate in the 2nd-half. Remains cautious but does note that valuation relative to INTC is becoming interesting for market neutral funds.
06:54 ET AOL Time Warner (AOL) 50.05: Reuters reports that company is moving closer to buying UK magazine publisher IPC Media in a deal valued at more than $1.4 bln, citing industry sources. |
