From Briefing.com: 5:12PM Cirrus Logic matches estimates; updates guidance (CRUS) 11.40 -0.75: Reports Q4 (Mar) loss of $0.12 per share, in line with the Multex consensus of ($0.12); revenues fell 58.1% year/year to $83.6 mln vs the $83.5 mln consensus; cash at the end of the fourth quarter was $153 million, compared with the $149 million cash balance at the end of Q3; for Q1, sees pro forma loss per share in the range of $0.06-$0.10 vs the current consensus estimate for a net loss of $0.09 per share; sees revs in the range of $87.7-$88.5 mln vs the current consensus estimate of $87.4 mln.
4:18PM ChipPAC tops by a penny, guides up for Q2 (CHPC) 9.02 -0.13: Reports Q1 loss of $0.15, $0.01 better than the Multex consensus; revs were $79.2 mln, vs consensus of $77.2 mln. Co expects Q2 revs of $88.5-$91 mln and EPS of ($0.07)-($0.09), vs consensus of $84.3 mln and ($0.11).
4:05PM O2Micro matches estimates (OIIM) 15.05 -1.25: Reports Q1 (Mar) earnings of $0.08 per share, in line with the Multex consensus of $0.08; revenues rose 83.0% year/year to $16.1 mln vs the $15.8 mln consensus.
3:21PM Nasdaq Composite Intraday : -- Technical -- Index continues to hold towards its best levels of the sessionand is currently working on resistance at 1680/1683. On a break higher, look for additional resistance at 1692 followed by more significant overhead at 1700. To the downside, watch for inital support at 1670/1674 followed by an additional floor at 1660
12:43AM Sun Microsystems: Zander's departure a concern-- Morgan Stanley (SUNW) 6.99 -1.19: -- Update -- Morgan Stanley believes that Zander was an important driver of SUNW's success over the past 4 years and his departure is an incremental negative to the co; also, the concentration of key mgmt departures is a concern and the firm finds it unsettling that the co has no intention to step-up its share buyback.
9:36AM Advanced Micro upgraded at Needham (AMD) 11.31 +0.13: Needham in a pre-open note upgrades to STRONG BUY from Buy due to valuation and the belief that significant upside potential exists for 2003 ests as microprocessor avg selling prices benefit from a richer mix of higher priced offerings to portable PC and low-end server applications. Price target is $20.
9:33AM Sun Microsystems downgraded to Neutral from Buy at Bear Stearns (SUNW) 7.39 -0.79: -- Update --
8:25AM Credence raises revenue growth outlook (CMOS) 20.24: Semiconductor equipment company now expects to post a 10% sequential increase in Q2 revenues. CMOS had previously provided guidance of flat sequential growth for the qtr.
7:50AM Micron Tech deal with Hynix may be revived-- Reuters (MU) 23.70: Reuters is reporting that creditors to Hynix, in an effort to revive the MU deal, are likely to seize control of the co after its board rejected the sale of the co to MU.
Applied Materials (AMAT) 24.40 +0.08: Wells Fargo downgrades to MKT PERFORM from Strong Buy, saying that the shares already discount a cyclical upturn, and that the co's product mix shift could hamper top-line growth and pressure operating margins. Raises FY02 est to $0.25 from $0.11 and cuts FY03 est to $0.72 from $0.85, and lowers price target to $25 from $28.
Close Dow +113.41 at 10059.63, S&P +9.53 at 1086.17, Nasdaq -10.70 at 1677.53: Headed into the session the market averages had built up some bullish momentum in the wake of yesterday's strong performance. However, negative developments in pre-market action in several larger cap tech names wiped this out and then some. Sun Microsystems (SUNW -14.7%) slumped after the news that the company's COO is retiring. It was also downgraded thereafter by Bear Stearns. Oracle (ORCL -5.8%) had its estimates cut by Lehman; firm cited the tough microenvironment, price pressure inflicted by purchasing managers and continued employee departures. Applied Materials (AMAT +0.3%) was downgraded by Well Fargo; firm feels cyclical upturn already priced into the shares. The software sector, the worst performing group, was hurt by the Peregrine (PRGN -49%) downgraded from CIBC and the profit warning for Q4 by Agile Software (AGIL -25.7%). The weaker than expected ISM Index (53.9 vs consensus of 55) and Construction Spending (-0.9% vs consensus -0.1%) data added to the downside pressure. Although firmly on the defensive this morning, the market averages were able to hold above this week's lows. This fact coupled with the oversold posture led to some buy side interest. Short covering likely played a role in the upward rotation as indicated by the leadership in some of the stocks/sectors that have been punished over the last month (such as SBC +5.1% and T +6.4% in the Dow). Those groups that have been steady/strong performers while the averages deteriorated also were in play today (health, gold, oil service, homebuilding). Reports of a lessening of tensions in the Middle East and the strong sales numbers from GM (+2.1%)--said that total April sales were up 13% and now sees Q2 North American production at 1.53M vehicles on continued strong consumer demand-- were also cited as reasons for the follow through afternoon gains. Try as it might, the Nasdaq Composite could not break through into positive territory during the push (software, networking, computer-hardware, Internet, disk drive all bearish) with minor slippage noted in the various averages into the close. The volatile action led to a heavy volume total with the market internals, like the averages, mixed. DJTA +1.4%, DOT -1.5%, Nasdaq 100 -0.7%, SOX +0.3%, S&P Midcap 400 +0.3%, XOI +0.7%, NYSE Adv/Dec 1929/1215, Nasdaq Adv/Dec 1649/1850
12:23PM Sun Microsystems (SUNW) 6.80 -1.38: Sun under $7? The stock has not been down here since late 1998. The drop this morning is due to the announcement that its chief operating officer will be stepping down after more than 15 years of service. Also, Bear Stearns downgraded the stock to Neutral. The departure is being viewed negatively as he was very good with customers. But it's not just that. The bigger picture concern is that this retirement is another in a string of recent management changes at Sun. Last week, long-time CFO Michael Lehman said he would retire. A week earlier, John Shoemaker, who had been with Sun since 1990, and headed its computer systems division, said he is leaving. It makes you wonder about the outlook for Sun. Why are all of these insiders leaving? What are they seeing? Sun, which specializes in servers, has been suffering from a sharp downturn in telecom and Internet companies buying its products. Also, enterprise sales have been affected by the overall IT spending slowdown. Sales are still not showing signs of a rebound as Q3 (Mar) sales were $3.1 bln, flat with Q2....So is it worth bottom fishing? When answering this question, the first thing you should look at is the balance sheet. Sun has cash/short term investments of $2.4 bln and an additional $3.9 bln in long term investments. Adding them together, this computes to $1.94 per share, which is solid. Also, it has a reasonable long term debt-to-cap ratio of 12%. Sun is doing a decent job of maintaining share and margins, but customers are simply not buying. There could be even more downside. Even at these beaten down levels, Sun still has a market cap of $22 bln which leaves room for more declines as IT spending has not showed much of a recovery and the executives leaving is a concern. Also, valuation is not great at a forward p/e of 37x. You should consider fishin' in another pond. -- Robert J. Reid, Briefing.com
2:30PM Cisco Systems (CSCO) 13.96 -0.69: This morning CSCO announced a definitive agreements to acquire privately-held Hammerhead Networks, Inc. and Navarro Networks, Inc. Merrill Lynch thinks it is unclear whether purchases are signal that things are getting better at CSCO since deals are spin-ins based either on Cisco exercising its call or the individual companies exercising their puts. While firm believes company is doing well in this environment, it does not believe investors should use today's events as an all-clear signal, points to next wk's earnings call as better indication of trend of business. Merrill maintains intermediate-term Buy rating; thinks as long as data networking remains the foundation of enterprise IT spending, CSCO should be able to capitalize on its strong market position....Shares trading 4.7% down.
1:15PM Merrill Hardware Conf (Day 2) : CY stated bookings to date are tracking ahead of expectations with particular strength from the wireless sector (33% of Q1 revenue) and indicated pricing appears to have improved during Q2 with ASPs expected to be down only 8-10% q/q during Q2, vs. a q/q decrease of 15-17% during Q1. LSCC stated QTD bookings have been consistent with its expectations of flat q/q revenue growth for Q2 or approx $59 mln. TECD reaffirmed the co's Apr qtr revenue and earnings outlook that was first issued in mid-Feb; co is expecting revenue to come in between $3.7-3.9 bln with EPS from $0.55 to $0.60. ATML believes its Jun qtr is on track, with strong bookings from the high growth products such as wireless LANs and microcontrollers.
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