Applied Materials (AMAT) - Get Report posted second-quarter earnings of 55 cents a share, in line with the 27-analyst estimate and up from the year-ago 18-cent profit. The company, which makes semiconductor-chip-making equipment, saw sales jump to $2.19 billion, an 87% increase from the year-ago report of $1.17 billion. New orders grew 19% to $2.93 billion from the first quarter, and were twice last year's $1.46 billion.

Applied Materials forecast third-quarter earnings between 64 cents to 68 cents a share, topping the 25-analyst estimate of 62 cents a share, while chip-making-equipment orders should hit $3 billion.

Credit Suisse First Boston

lifted Applied Materials' EPS views and urged an aggressive buy based on weakness.

Bear Stearns

analyst Robert Maire said he continued to recommend the stock as a buy and reiterated a 12-month target of 135. Bear Stearns boosted 2000 EPS estimates to $2.37 from $2.20 and 2001 EPS views to $3.47 from $3.

For more on Applied Materials

first-quarter earnings, check out

TheStreet.com/NYTimes.com

coverage.

Mergers, acquisitions and joint ventures

British Airways

(BAB) - Get Report

said it had launched its Internet travel agency with 10 other airlines in a move by the industry to slash huge ticketing and distribution costs. The travel agency portal also includes

Air France

,

Lufthansa

,

Iberia

,

SAS

,

KLM

( KLM),

Alitalia

,

British Midland

,

Aer Lingus

,

Finnair

and

Austrian Airlines Group

.

Leap Wireless

( LWIN) said Spain's

Endesa

will buy its Chilean wireless operations.

Earnings/revenue reports and previews

(

Earnings estimates from First Call/Thomson Financial; earnings reported on a diluted basis unless otherwise specified.

)

CNA Financial

(CNA) - Get Report

posted first-quarter operating earnings of 45 cents a share, well above the six-analyst estimate of 38 cents and the year-ago 13 cents.

Encompass Services

(ESR)

reported first-quarter earnings of 15 cents a share, in line with the five-analyst estimate.

Interim Services

( IS) reported first-quarter earnings of 37 cents a share, beating the 12-analyst estimate of 35 cents and up from the year-ago 33 cents a share.

Mylan Laboratories

(MYL) - Get Report

reported fourth-quarter earnings of 34 cents a share, beating the 10-analyst estimate by a penny and up from the year-ago earnings of 27 cents a share.

Navigant Consulting

(NCI) - Get Report

posted first-quarter earnings of 12 cents a share well below the five-analyst estimate of 21 cents and the year-ago 28 cents. The utilities management consulting firm said it would provide an employee stock option exchange program designed to be value neutral to shareholders.

Pentair

(PNR) - Get Report

said it expects a record year in operating earnings, revenues and earnings-per-share. The company said it expects annual revenue to double to $6 billion by 2005 and expects growth at double-digit rates through the next five years.

ShopKo Stores

( SKO) reported first-quarter earnings of 9 cents a share, in line with the five-analyst estimate and up from the year-ago earnings of 7 cents a share.

Western Gas Resources

( WGR) reported first-quarter earnings of 32 cents a share, including a gain of or 10 cents a share from the sale of the company's unit,

Western Gas Resources-California

, beating the 6-analyst estimate of 18 cents and up from the year-ago loss of 15 cents.

Zale

(ZLC)

reported third-quarter earnings of 30 cents a share, beating the 16-analyst estimate of 26 cents and up from the year-ago 17 cents a share.

Analyst actions

CSFB analyst Michael Exstein rated

Wal-Mart

(WMT) - Get Report

a buy. The stock was added to the firm's focus list.

Upgrades

Chartered Semiconductor

( CHRT): eanings-per-share and revenue estimates UP at Credit Suisse First Boston.

Duke Energy

(DUK) - Get Report

: DOWN to outperform from buy at ABN Amro.

ExxonMobil

(XOM) - Get Report

UP to buy from market perform at

Deutsche Banc Alex Brown

.

Fundtech

( FNDT): UP to buy from long-term attractive; near-term price target: 34; 12-month target: 45-50 at

Robertson Stephens

.

Initiations

Exelixis

(EXEL) - Get Report

: NEW buy rating at CSFB; price target: 40.

24/7 Media

( TFSM): NEW price target of 50.at CSFB.

West TeleService

( WTSC): NEW buy; price target 28 at CSFB.

Group Actions

ABN Amro downgraded its recommended stance on the UK and European telecommunications sector, to underweight from in line. ABN cut its three-month rating on

Vodafone

(VOD) - Get Report

to hold from buy, while reiterating a cautious view on companies including

Equant

(ENT) - Get Report

and

Telewest

( TWSTY). The bank retained a more positive stance on companies including

British Telecom

( BTY) and

Cable & Wireless

(CWZ)

.

Miscellany

MP3.com

( MPPP) said it would not allow users to access major label songs contained in its database, while it works toward settling a copyright infringement suit brought on by major record companies. Last month, a district judge decided that the company violated copyrights held by major record labels, including

Time Warner's

(TWX)

Warner Brothers Music

,

Sony Music Entertainment

and

Seagram's

(VO) - Get Report

through the development of its

my.mp3.com

database. The database gives users the capability to obtain and store music digitally, and then retrieve it using any computer.

Five large pharmaceutical firms agreed for the first time to discuss with the

United Nations

sharply reduced prices for HIV drugs for developing nations, particularly in Africa. The five companies include

Merck

(MRK) - Get Report

,

Bristol-Myers Squibb

(BMY) - Get Report

,

Glaxo Wellcome

( GLX).

Roche Holding

and

Boehringer Ingelheim

.

Office Depot

(ODP) - Get Report

and

America Online

(AOL)

will form a five-year joint marketing strategic alliance valued at more than $44 million. The companies said they will develop a co-branded business site offering online office solutions to small business customers. The alliance will give AOL a presence in all Office Depot sales channels and will put Office Depot's name-brand office supplies and other products in shopping and business-to-business areas across several America Online brands.

The Heard on the Street column in

The Wall Street Journal

says despite the downturn in technology stocks, many brokerage firms still have heavy weightings of tech stocks in their portfolios though the mix of stock names has changed.

Investors at

Charles Schwab

( SCH) traded less in April than March, according to the online broker's latest monthly activity report. In addition, May's activity is lower than in April, according to a statement by Chief Executive Officer David Pottruck, who attributed the decline to seasonality. April's daily average revenue trades fell 9% to 317,300 from 346,900, but were still higher than last April's then record of 207,700 trades a day. Customer assets held by the brokerage declined on the month as well to $774.9 billion from $823.2 billion in March, but again were up from the $564.3 billion the company held last April. Schwab attributed the monthly decline in assets in part to selling by customers to pay taxes. Schwab's monthly market report is often used as a barometer for the entire online trading industry.

Microsoft

(MSFT) - Get Report

filed its counterproposal to the government's

breakup plan Wednesday, asking instead for a remedy involving limits on its business practices.

The proposal asks Judge Thomas Penfield Jackson, who has ruled the software company violated antitrust laws, to set restrictions governing its license agreements with computer makers. The restrictions would prohibit Microsoft from withholding license agreements from companies that ship or promote operating systems other than its ubiquitous Windows system.

The proposal would also require Microsoft to allow computer makers to ship versions of Windows that do not include Internet Explorer, the company's Web browser, as a default browser.

--

Michael Brick