The Night Watch: Tellabs Warning Leads Equipment Stocks Lower
The late players gyrated to that same earnings beat tonight, as a trickle of companies made the late wires with their latest profit confessions, pushing most tech outfits onto negative ground.
Tellabs
(TLAB)
tumbled 13.9% to $18.26 on
Instinet
after the telecom equipment maker admitted it has succumbed to the "dramatic changes affecting the landscape of the telecommunications marketplace." On
Island
ECN, the stock dropped 13.3% to $18.38.
Indeed, as the latest telecom casualty, Tellabs warned after the bell that second-quarter earnings per share would be break-even before restructuring and other charges, compared with profits of 39 cents a share in the year-ago quarter. Its latest forecast is sharply off the 29-cents-a-share consensus estimate by
Thomson Financial/First Call
. The company, which said it sees ongoing "caution" from its customers -- namely the telecom network builders -- also expects revenue of about $500 million, compared with its prior forecast of $780 million to $820 million.
Fellow equipment maker
Ciena
(CIEN) - Get Report
, which had its top- and bottom-line estimates for the third and fourth quarter slashed by
Deutsche Banc Alex. Brown
earlier today, continued its fall tonight, dipping 3.9% to $35 on Instinet. Likewise, bellwether
Cisco
(CSCO) - Get Report
, recently the most heavily traded stock on Instinet, was losing 2.3% to $16.25, while
Juniper
(JNPR) - Get Report
lost 1.9% to $28 on Island.
Jabil Circuits
(JBL) - Get Report
, an electronics manufacturer based in St. Petersburg, Fla., lost 0.4% to $25 on Instinet as a result of lower third-quarter earnings, which came in line with analysts' lowered targets.
The company posted earnings of $32.3 million, or 16 cents a share, excluding costs and charges, down from $38.7 million, or 21 cents a share, a year earlier. Meanwhile, the quarter's revenue of $1.05 billion was down 14% from the prior quarter but up 8.3% from a year ago.
Shares of
Excite@Home
(ATHM) - Get Report
rose tonight after the company
announced it will receive $85 million from
AT&T
(T) - Get Report
as part of a restructured optical-fiber backbone contract with the telecommunications giant. Separately, the cable companies
Cox Communications
(COX)
and
Comcast
(CMCSK)
will be ending their exclusivity arrangements in December, six months ahead of schedule, Excite@Home said. Shares of Excite@Home rose 2.1% to $1.94 on Island.
Still, red wasn't the
only
color tonight, and certainly not for
RedHat
(RHAT)
, whose stock was in the green as a reward for posting its first quarterly profit, in line with the Street's expectations. Its shares rose 5.5% to $5.01 on Instinet and 5.3% to $5 on Island.
The company, the leading distributor of the Linux operating system, said adjusted first-quarter earnings were $600,000, essentially break-even EPS, compared with an adjusted loss of $3.7 million, or 2 cents a share, for the year-ago period. Revenue grew 18% to $25.6 million from $21.7 million last year.
Among other climbers tonight,
Metromedia Fiber Networks
(MFNX)
gained 3.8% to $1.65 on Island, a day after the fiber-optic network builder warned of lower 2001 revenue.
Exodus Communications
(EXDS)
climbed 2.1% to $2.90 on Island, shrugging off a reduced price target today by
Prudential
, at least for now. Meanwhile, outfits such as
Veritas Software
(VRTS) - Get Report
,
WorldCom
(WCOM)
and
Network Appliance
(NTAP) - Get Report
were among those in positive territory tonight.
After Tuesday's Close
- Asyst Technologies (ASYST) , which makes robotic equipment for semiconductor manufacturing, cut its first-quarter revenue forecast from $75 million to between $65 million and $70 million, citing "ongoing pressure on bookings and backlog" as well as limited earnings visibility.
3Com (COMS) said it would sell facilities in Massachusetts and Illinois as well as a portion of its headquarters in Santa Clara, Calif., as part of a plan to outsource manufacturing to Singapore's
Flextronics (FLEX) - Get Report. The maker of networking equipment also said a Singapore facility will become 3Com's Asia-Pacific distribution center.
Federated Department Stores (FD) said it has agreed to buy
Liberty House, Hawaii's largest retailer, for an undisclosed amount. The company said the deal would have a neutral impact on the company's earnings per share over the next 18 months, excluding one-time costs.
Texaco (TX) - Get Report said a brief fire at its 190,000-barrels-per day refinery in Pembrokeshire, Wales, put only one refinery unit out of action. There were no casualties, according to a report by
Reuters.
Wachovia (WB) - Get Report and
First Union (FTU) announced they have received antitrust clearance from the U.S.
Federal Trade Commission for their proposed "merger of equals."
Wednesday's Economic Data
(
Forecasts are from
Reuters
. Times are Eastern. For a longer-term economic calendar and more, see
TSC's
Economic Databank.
)
- 7 a.m.:
Mortgage Applications Survey for the week ended June 17. Source:
Mortgage Bankers Association. Forecast: n.a. Previous: 1776.9.
Purchase index: Forecast: n.a. Previous: 344.1
9 a.m.:
Treasury buyback announcement. Source:
Bureau of the Public Debt. The Treasury announces the details of tomorrow's reverse auction.
10 a.m.:
Leading economic indicators for May. Source:
Conference Board. Forecast: n.a. Previous: +0.1%.
1:30 p.m.:
Treasury auction. Source:
Bureau of the Public Debt The Treasury announces the results of its monthly two-year note auction, at which $10 billion of securities will be sold, with bids due at 1 p.m.
2 p.m.:
Federal Budget for May. Source:
Treasury Department. Forecast: -$22.05. Previous: +189.796B (April FY '01)
6:30 p.m.:
Consumer Comfort Index. Source:
Money Magazine and ABC News Forecast: n.a. Previous: 3
Speeches & Testimony
- Federal Reserve chairman
Alan Greenspan delivers testimony to the
U.S. Senate Committee on Banking, Housing, and Urban Development on the condition of the banking system in Washington at 10 a.m.