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Technology Stocks : Wind River going up, up, up! -- Ignore unavailable to you. Want to Upgrade?

To: Techplayer who wrote (4626)	4/5/1999 4:38:00 PM
From: bob	Read Replies (1) \| Respond to of 10309

Perhaps the entire sector is undergoing a correction. Just a guess, but without any news from the company it's as good as any other reason. Interesting article may support this notion even if it is unfounded with regards to Wind: Software earnings look, well, soft By Brenon Daly, CBS MarketWatch Last Update: 3:24 PM ET Apr 3, 1999 Earnings Surprises Software Report SAN FRANCISCO (CBS.MW) -- The first quarter for big-name software companies is expected to set the tone for the rest of the year, and "it's not going to be pretty," according to one analyst. Bob Austrian, analyst at NationsBanc Montgomery Securities, said he expected things to "get worse before they get better" for makers of big-ticket software. That was seen at the end of March as PeopleSoft (PSFT) shares sank to a three-year low after the company warned that its first-quarter sales will be flat or up only slightly from a year ago. Earnings are expected to decline in the first quarter, after growing 70 percent annually over the past half decade. Blame the so-called "Year 2000 bug" for the slowdown. Businesses have been delaying buying new software as they make sure that the software they already has doesn't seize up as we approach the new millennium. The Y2K factor "It's an interesting period," said Jim Pickrel, who follows software companies for Hambrecht & Quist in San Francisco. "A lot of people are still wary of what impact the Year 2000 will have on [software] spending." Another large player, German powerhouse SAP (SAP), said in late March that its first quarter profit would fall "significantly short" of the 1998 figure. See related story. The slowing growth has taken its toll on these companies, as well as other companies that make so-called enterprise resource planning (ERP) software. These products automate basic business functions, such as accounting or human resource operations. Shares in PeopleSoft, SAP and Baan (BAANF) are all just above their 52-week lows. Yet, even as Pickrel acknowledges the slowdown in ERP spending, he adds "there's been a little too much concern" about other software areas. He points to makers of front office or analytical software as companies that should do well. In particular, Pickrel mentioned both Siebel Systems and i2 as companies that are "doing pretty well" and shouldn't get snagged by the Year 2000 glitch. Siebel (SEBL) is expected to show earnings of 15 cents per share, according to analysts polled by First Call. That compares to 10 cents in the first-quarter last year for the company, which makes software to automate the sales process. Analysts project i2 (ITWO) earnings will be flat at a nickel, according to First Call. Beyond the bug Not that all the slowdowns, or concerns about a slowdown, are being caused by the "millennium bug." Shares of Network Associates (NETA) lost nearly half their value in the first quarter on concerns about a sluggish product line and the way it's accounted for past acquisitions. See related story. No surprises are expected from the world's largest software company when it reports fiscal third quarter results in the week of April 19. Microsoft (MSFT) chief financial officer Greg Maffei said in mid-March that he's "comfortable" with analysts' expectations of earnings of 65 cents per share on sales of about $4.2 billion. See related story. Microsoft shares rose more than a quarter in value during the first quarter, even as the Justice Department investigated alleged illegal bullying tactics.