Stocks to Watch: MSFT, SMS, GPS, RLR, HOMS, RXSD, TWX, GE, INTC

ING Barings will buy ReliaStar, the eighth-largest publicly held U.S. life insurer.
Author:
Publish date:

ReliaStar Financial (RLR) jumped 6 15/16, or 15.8%, to 50 15/16 after financial services group ING Barings (ING) - Get Report said it would buy it in a $6.1 billion deal including $1 billion of existing ReliaStar debt.

ING was lately rising 15/16 to 54 7/8. ING agreed to pay $54 for each ReliaStar share, and said it expected after-tax synergy benefits of $25 million in 2001, rising to $65 million by 2005.

Intel

(INTC) - Get Report

gained 2 3/4 to 129 5/8 and content management products developer

Excalibur Technologies

(EXCA)

added 2 3/16, or 6.2%, to 37 11/16 after the companies said they've signed an agreement to form a new company that will enable owners of "branded high-value content," such as sports and entertainment, to produce and sell audio and video content over the Internet.

Reuters

reported terms of the agreement call for Intel to contribute its Interactive Media Services division and invest $150 million in exchange for 60 percent of the new company's equity. Excalibur will combine its entire business operations with those of the new company, with Excalibur stockholders receiving 40 percent ownership in the new company in exchange for their Excalibur stock. Excalibur shareholders will receive one share of stock in the new company for each share they hold of Excalibur. Other financial details were not disclosed.

Mergers, acquisitions and joint ventures

America Online

(AOL)

slipped 1/8 to 59 13/16 and

Homestore.com

(HOMS)

jumped 4 7/8, or 26.7%, to 23 1/8 after the companies entered a five-year marketing agreement under which Homestore.com will be the leading provider of real estate listings on the online service. The deal is valued at more than $200 million.

Disney

(DIS) - Get Report

dropped 13/16 to 42 13/16 after it pulled its ABC network from media company

Time Warner's

(TWX)

cable systems in 11 cities around the U.S. after the companies could not come to terms on a new contract. Time Warner was lately down 1 3/16 to 88 3/4.

General Electric

(GE) - Get Report

gained 3 5/8 to 160 15/16 and

Lubrizol

(LZ)

lost 5/16 to 25 5/16 after the companies said they are in a pact to sell products managing diesel fluids

Hewlett-Packard

(HWP)

fell 15/16 to 134 1/16 and

AT&T's

(T) - Get Report

AT&T Broadband unit have agreed to form an alliance to enable customers to print content from their television sets, the companies announced. AT&T added 2 5/16, or 5%, to 48 1/4.

Dutch group

Numico

said it had reached an agreement with

Rexall Sundown

(RXSD)

to pay $24 a share, or a total of $1.8 billion, for the U.S. vitamin and nutritional supplement maker. Rexall was lately hopping 4 3/16, or 21.4%, to 23 3/8.

Safeguard Scientifics

(SFE) - Get Report

sailed up 6 1/8, or 14.5%, to 48 1/4 after it said it has raised $50 million each from

Compaq

(CPQ)

and

IBM

(IBM) - Get Report

and formed strategic relationships with both companies. Compaq fell 11/16 to 28 13/16 and IBM rose 9/16 to 112 3/16.

Siemens

(SMAWY)

said it will buy

Shared Medical Systems

(SMS)

, a healthcare software and service provider, for $2.1 billion. Shared Medical soared 29 3/16, or 70.4%, to 70 5/8.

A group of utility companies in the Pacific Northwest plans to form a stand-alone transmission company to which they propose transferring control of their powerline assets,

The Wall Street Journal

reported in its online edition. The new company would have a book value of $1.8 billion. According to the story, the involved companies are:

Avista

(AVA) - Get Report

;

Montana Power

(MTP) - Get Report

;

Enron

(ENE)

unit Portland General Electric and

Sierra Pacific Resources

(SRP)

units Nevada Power and Sierra Pacific Power. Avista added 7/8 to 30 3/8, Montana moved down 5/16 to 43 5/8, Enron rose 3 1/16 to 72 3/4 and Sierra Pacific inched up 1/8 to 15 1/4.

Earnings/revenue reports and previews

(

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

)

Offerings and stock actions

Fiber optic manufacturer

Amphenol

(APH) - Get Report

was falling 4 3/16, or 6.5%, to 59 9/16 after it reported that it has filed for a secondary offering of 6 million shares of its common stock. Selling stockholders include affiliates of

Kohlberg Kravis Roberts

and certain company management.

The board of

PC Connection

(PCCC)

was mounting 5 3/4, or 12%, to 53 3/8 after it approved a 3-for-2 stock split today.

Analyst actions

Upgrades

Donaldson Lufkin & Jenrette

said

King Pharma

(KING)

replaced

Wells Fargo

(WFC) - Get Report

on its focus list. King Pharma bounced 4 7/16, or 8/9%, to 53 13/16 and Wells Fargo added 7/16 to 41 1/2.

SG Cowen

said it named

Scientific-Atlanta

(SFA)

as number one action idea for this week. Scientific-Atlanta jumped 4 5/8, or 7.1%, to 69 11/16.

Downgrades

ING Barings

downgraded

KLM Royal Dutch Airlines

(KLM)

to sell from hold after the carrier cancelled its alliance with

Alitalia

. ING said KLM would lose about 200 million euros' worth of synergy gains over a three-year period. KLM Royal Dutch tacked on 7/16 to 17 1/2.

Solectron

(SLR)

: DOWN to buy from strong buy at SG Cowen. Solectron sank 5 5/8, or 11.9%, to 41 5/16.

Initiations

Alamosa PCS

(APCS)

: NEW market perform at

Deutsche Banc Alex. Brown

. Alamosa PCS edged up 1/2 to 29.

A number of brokerages initiated coverage on

MetLife

(MET) - Get Report

:

Goldman Sachs

added the stock to its U.S. recommended-for-purchase list.

J.P. Morgan

started coverage with a buy and price targets at 20.

UBS Warburg

started coverage with a buy.

Donaldson Lufkin & Jenrette

started MetLife with a buy and a 12-month target of 22.

Credit Suisse First Boston

started coverage with a buy.

Morgan Stanley Dean Witter

started coverage with an outperform and a target of 22.

Merrill Lynch

started coverage with a near-term accumulate, long-term buy.

Banc of America

started coverage with a strong buy and a 12-month target of 22.

Met Life lifted 13/16 to 17 3/8.

Krispy Kreme

(KREM)

: NEW buy at Deutsche Banc Alex. Brown and NEW long-term buy at JP Morgan with price target of 45. Krispy Kreme slipped 3 1/4, or 7%, to 42 3/4.

Oratec Interventions

(OTEC)

: NEW buy; price target: 45 at J.P. Morgan. Oratec Interventions gained 1 3/16 to 35 1/4.

Vyyo

(VYYO)

: NEW buy at

W.R. Hambrecht

, price target: 35. Vyyo lifted 2 3/8, or 11.2%, to 23 1/2.

Group Moves

UBS Warburg

re-initiated coverage of

MCI Worldcom

(WCOM)

and

Sprint

(FON)

:

MCI Worldcom: re-started with a strong buy, price target: 85. MCI World Com climbed 15/16 to 46 5/16.

Sprint: re-started at buy. Sprint added 2 1/4 to 63 3/4.

Banc of America

made rating changes on four retail companies:

Jones Apparel

(JNY)

: DOWN to market perform from buy. Jones Apparel lost 3/4 to 28 15/16.

Liz Claiborne

(LIZ)

: DOWN to market perform from buy. Liz Claiborne shed 15/16 to 45 3/8.

Gap

(GPS) - Get Report

: UP to strong buy from buy. Gap gained 1 9/16 to 38 5/16.

Payless Shoesource

(PSS)

: DOWN to market perform from buy. Payless Shoesource jumped 5/16 to 55 7/16.

Miscellany

Defense contractors

General Dynamics

(GD) - Get Report

and

Boeing

(BA) - Get Report

lost a U.S. Supreme Court appeal for $1.2 billion in damages today. The appeal was part of a long legal battle between the companies and the Pentagon regarding a contract for A-12 radar-evading aircraft. General Dynamics stumbled 1 9/16 to 56 15/16 and Boeing declined 7/17 to 39 1/4.

As expected, the government

asked a federal judge on Friday to break up

Microsoft

(MSFT) - Get Report

into two separate companies to curb its monopoly power in key software.

Thomas Weisel

analyst David Readerman lowered his Microsoft "bust-up" price target to the 50-to-55 range, down from the previous 65 per share following the November 1999 findings of fact by U.S. Judge Thomas Penfield Jackson. Microsoft climbed 3 1/4 to 73.

The Heard on the Street column in the

Journal

said

George Soros

and other large hedge fund managers have had their fair share of difficulties, while a new breed of smaller specialized hedge funds is scoring big, indicating the game has changed. According to the story, it has become more difficult to take advantage of overlooked efficiencies such as irregularities in exchange rates. As a result, many large hedge fund managers shifted into stocks, only to find their advantage reduced since the same information is widely available to even small investors.

See

TheStreet.com's

separate coverage of Soros fund manager

Stanley Druckenmiller's recently announced departure from the giant Quantum hedge fund.