Company Report: WebMethods, Lante Make Their Mark With Massive Debut Gains
(Earnings estimates from First Call/Thomson Financial; earnings reported on a diluted basis unless otherwise specified. New highs and lows on a closing basis unless otherwise specified.)
Initial public offering
WebMethods
(WEBM)
soared 177 5/8, or 507.5%, to 212 5/8, making it the fourth-highest percentage gainer of all time for an IPO debut. The gain is all the more impressive when compared with the heavy selling pressure that swept the rest of the market, leaving the tech-laden Nasdaq down 90.18, or 2%, to 4395.45. WebMethods company provides customer with direct links to buyers and suppliers, connecting them to major B2B marketplaces.
Internet services company
Lante
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also turned some heads as it rocketed 34 15/16, or 174.6%, to close at 54 15/16 in its trading debut. Lante develops software for electronic markets where buyers and sellers meet. Of course not all the new kids on the block did so well, and at least one proved to be a real dog on its first day of trading (see table below).
Mergers, acquisitions and joint ventures
Cameron Ashley Building Products
(CAB)
gained 1 7/8, or 13.2%, to 16 1/16 after it said it has received an unsolicited takeover offer from
Guardian Industries
for $17 a share, or $148.1 million, based on the 8.71 million shares of Cameron Ashley outstanding. Cameron Ashley closed yesterday at 14 3/16.
InfoCure
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TheStreet Recommends
jumped 4 7/16, or 22%, to 24 5/8 after it said that
Healtheon/WebMD
(HLTH)
would take up to a $100 million stake in its
VitalWorks.com
division before its IPO. Healtheon was unchanged at 55. Healtheon would purchase $10 million in cash convertible preferred stock, converting into 1% interest after VitalWorks goes public. Healtheon will also invest another $90 million after the IPO.
National Westminster Bank
(NW)
dropped 2 to 106 after it told its shareholders to accept
Royal Bank of Scotland's
$34 billion offer. NatWest has been a takeover target for both Royal Bank of Scotland and
Bank of Scotland
, who were in a bidding war over the bank. This week, three of NatWest's biggest shareholders threw their support behind the Royal Bank's offer.
Earnings/revenue reports and previews
Dell
(DELL)
fell 1 59/64 to 36 7/8 after late yesterday reporting fourth-quarter earnings of 16 cents a share, a penny ahead of the revised 29-analyst estimate and the year-ago earnings. The consensus estimate was lowered from 21 cents a share, excluding the gain, following Dell's Jan. 26 announcement that it expected to report fourth-quarter net income of about 16 cents a share, including an investment gain of 1 cent a share.
Dell said its profit growth was slowed by parts shortages and a sales slowdown tied to Y2K fears. Net income was $436 million, compared with $425 million in the year-ago period.
Credit Suisse First Boston
reiterated its strong buy rating on Dell.
For more on Dell's
earnings, see coverage from
TheStreet.com/NYTimes.com
joint newsroom.
Advanced Micro Devices
(AMD)
,
Intel's
(INTC)
main rival in PC main microprocessors, said it expected it sales in the first quarter to be even with, or slightly higher than the seasonally strong fourth-quarter. AMD gained 2 1/2, or 5.9%, to 45 while Intel lost 1 3/4 to 105 7/8.
Dole
(DOL)
climbed 1 to 15 1/16 after it posted fourth-quarter earnings of 4 cents a share, a penny better than the four-analyst estimate and up from the year-ago 13-cent loss.
Electrolux
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of Sweden lost 1 3/4 to 44 3/4 after it reported income for 1999 after financial items of $716 million, a little above expectations, according to
Reuters
. The company expects continued good demand in North America this year in all product areas, while in Europe, it expects market conditions to improve in 2000 compared to 1999.
Howmet
(HWM)
was unchanged at 18 1/8 after it posted fourth-quarter earnings of 33 cents a share, beating the six-analyst estimate of 28 cents and up from the year-ago 19 cents.
Pep Boys
(PBY)
lost 1/4 to 6 13/16 after it reported a 3.8% decline in fourth-quarter same-store sales.
Scana
(SCG)
reported fourth-quarter earnings of 20 cents a share, greatly missing the six-analyst estimate of 32 cents and down from the year-ago 30 cents.
TJX
(TJX)
lost 1/2 to 16 3/4 after it said it restated first-quarter earnings to include a $5.6 million, or 2-cent per share, accounting-related charge.
Trigon Healthcare
(TGH)
tacked on 1 3/8 to 34 after it reported fourth-quarter earnings of 62 cents a share, edging out the 15-analyst estimate of 59 cents and up from the year-ago 49 cents.
Twinlab
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slipped 5/16 to 7 3/8 after it posted fourth-quarter earnings of 12 cents a share, a penny shy of the two-analyst estimate and down from the year-ago 26 cents.
Wendy's
(WEN)
inched up 1/8 to 17 3/8 after it posted fourth-quarter earnings of 33 cents a share, a penny better than the 13-analyst estimate and up from the year-ago 9 cents.
Offerings and stock actions
Company | Offering Price | Current Price | % Change |
Fargo Electronics | $15 | 15 1/8 | +0.8% |
Pets.com | $11 | 11 | -- |
Via Net. Works | $21 | 49 13/16 | +137.2% |
AT&T
(T)
lost 1/2 to 48 5/8 after it said it has tapped
Goldman Sachs
,
Merrill Lynch
and
Salomon Smith Barney
as lead underwriters for the $10 billion IPO of its wireless tracking stock.
Varian
(VARI)
gained 1/2 to 36 3/4 after it said it authorized a program to repurchase up to 1 million shares.
Analyst actions
Salomon Smith Barney upped its rating on
American General
(AGC)
to strong buy. American General gained 2 1/4 to 55 5/16.
CIBC World Markets
upped its rating on
Alcoa
(AA)
to buy from hold. Applied Graphics lost 11/16, or 9.1%, to 6 13/16 and Alcoa bounced 2 3/16 to 67 11/16.
SG Cowen
sliced its rating on
Applied Graphics
(AGTX)
to buy from strong buy.
J.P. Morgan
initiated coverage of
D&S
(DYS)
with a market perform rating. D&S slid 1/8 to 22 7/8.
Banc of America Securities
cut its rating on
Fatbrain.com
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to buy from strong buy. Fatbrain.com declined 6 7/8, or 33.1%, to 13 7/8.
Donaldson Lufkin & Jenrette
raised its rating on
Grupo Radio Centro
(RC)
to buy from market perform. Grupo Radio Centro tacked on 1/16 to 8 15/16.
Deutsche Banc Alex. Brown
raised its rating on
Harbinger
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to buy from market perform. Shares of Harbinger bounced 1/4 to 29 1/2.
Morgan Stanley Dean Witter
upgraded
Keane
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to outperform from neutral. Shares of Keane lost 2 1/16, or 7.4%, to 25 1/2.
Merrill Lynch upgraded
Nabors Industries
(NBR)
to intermediate-term buy from accumulate. Shares of Nabors Industries advanced 1 to 32 7/8.
Banc of America Securities raised its price target on
Network Solutions
(NSOL)
to 400 from 375. Network Solutions gained 9 13/16 to 302 1/8.
Salomon Smith Barney upped its price target on
Nucor
(NUE)
to 65 from 55. Nucor added 1 7/8 to 47 1/8.
Merrill Lynch upped its rating on
Office Depot
(ODP)
to intermediate- and long-term buy from accumulate. Office Depot skidded 3/4, or 5.5%, to 12 7/8.
Merrill upgraded its intermediate-term rating on
Royal Dutch Petroleum
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to buy from accumulate. Royal Dutch shed 3/4 to 53 7/8.
Merrill upgraded its intermediate-term rating on
Shell Transport
(SC)
to buy from accumulate. Shell Transport retreated 15/16 to 42 13/16.
PaineWebber
raised it rating on
Sunoco
(SUN)
to buy from attractive and upped its price target to 35 from 30. Sunoco lifted 9/16 to 24 1/2.
Morgan Stanley Dean Witter upped its price target for
Telecom Argentina
(TEO)
to 58 per ADR from 35 per ADR. Telecom Argentina skidded 5/8 to 45 1/4.
DLJ upgraded
TV Azteca
(TZA)
to buy from market perform. TV Azteca dropped 1/8 to 12 15/16.
Banc of America Securities raised its price target on
TriQuint Semiconductor
(TQNT)
to 300. TriQuint leapt 29 5/16, or 12.8%, to 257 1/4.
Deutsche Banc Alex. Brown upped its rating on
Wink Communications
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to buy from market perform. Wink Communications jumped 5 1/16, or 7.8%, to 70.
Lehman Brothers
rolled out coverage of
XM Satellite Radio
(XMSR)
with a buy rating and a price target of 60. XM Satellite Radio climbed 1 3/4, or 5.8%, to 31 9/16.
Miscellany
Cabletron Systems
(CS)
rose 1 9/16 to 38 3/16 after said it plans to reorganize its core business into four independent operating companies in order to better focus on high-growth areas of the communications market.
The new companies --
Riverstone Networks
,
Enterasys Networks
,
Global Network Technology Services
and
Aprisma Management Technologies
-- will focus on service provider, enterprise electronic business, professional services and infrastructure management, the company said. Cabletron said the four units eventually will be separate, publicly traded companies.
Dow Chemical
(DOW)
slid 3/16 to 105 3/4 after it said it tapped Michael Parker as its new president and CEO.
Internet heads will talk with the
Clinton
administration next week on how to respond to this week's Web attacks,
The Wall Street Journal
reported. According to the
Journal
, the attacks sparked concerns about whether the government is doing enough to protect the Internet.
Usually when a company loses a court fight it means bad things for its stock, but that wasn't the case for shares of
Medco Research
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this week, the Heard on the Street column in
The Wall Street Journal
reported. Medco Research fell 1/8 to 30 7/8.
The
Delaware Chancery Court
ruled on Wednesday, in a suit filed by the Wisconsin Investment Board, that Medco will delay for at least 15 days a shareholder vote -- which was set for yesterday -- on its planned takeover by
King Pharmaceuticals
(KING)
for no more than $397 million, or $34 a share, the column said. King Pharmaceuticals edged up 3/4 to 51 3/4.
In response, Medco shares rose 7% yesterday, the column reported. The stock rose because Medco shareholders stand to gain about $50 million from the ruling, according to a lawyer with the Wisconsin Investment Board, which owns 11.6% of Medco, the column said. The board filed the suit to block the merger, citing its value, the column said.
QLT PhotoTherapeutics
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lost 1 3/4 to 68 1/8 after it said it received an approvable letter for its macular degeneration treatment
Visudyne
from the
Food and Drug Administration
.
The Inside Wall Street column in
Business Week
, written by Gene Marcial, reports that some big investors believe
America Online
(AOL)
,
Yahoo!
(YHOO)
and
Microsoft
(MSFT)
are separately interested in buying
StarMedia Network
(STRM)
, an Internet media company for Spanish and Portuguese-language audiences. AOL declined 1 11/16 to 56 9/16 and Yahoo! plummeted 22 5/16, or 6.1%, to 342 11/16, while Microsoft slid 6 1/16, or 5.7%, to 99 15/16. StarMedia Network hopped 5 1/4, or 11.1%, to 52 1/2.
The column also includes an item on
Southdown
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, the second-largest cement producer in the U.S., whose stock has soared from 46 in early December to 57 7/8 lately, in part because a number of investors think that Southdown is a takeover target. Southdown advanced 15/16 to 57 1/8.
Also in the column,
Emcor Group
(EMCG)
garners bullish mention. Emcor gained 1 1/2, or 7.4%, to 21 3/4.
