Updated from 3:18 p.m. EDT

Profit warnings from technology giants

Intel

(INTC) - Get Report

and

Apple

(AAPL) - Get Report

have roiled the markets in recent weeks, damaging the

Nasdaq Composite Index and sparking talk of more trouble to come.

The latest warning came from PC giant

Dell

(DELL) - Get Report

.

Dell said its third-quarter sales were coming in about 3 percentage points below expectations; the company blamed weak demand in Europe. Dell said it remains on track to meet the 24-analyst

First Call/Thomson Financial

estimate of 25 cents in the quarter, but it warned that fourth-quarter per-share earnings could be 1 cent to 2 cents below company targets.

Bear Stearns

cut Dell's 2001 EPS outlook to 92 cents from 94 cents and 2002 EPS to $1.05 from $1.20 and kept a neutral rating.

Lehman Brothers

said Dell's 2001 revenue growth view of 25% is more prudent than the earlier figure of 30%.

For a quick take on companies that have warned so far, see

TheStreet.com's

tracking table. Also, see additional coverage from

TSC

on Dell's

latest news.

Dell ended the day down $3, or 10.6%, to $25.19; Intel was down $1, or 2.4%, to $41; and Apple was down $1.56, or 6.6%, to $22.06.

And now for some good news. Chip giant

Micron Technology

(MU) - Get Report

said fourth-quarter results were well above estimates. Micron posted earnings of $1.16, excluding a pretax gain from the sale of one of its facilities. The 26-analyst estimate called for earnings of 96 cents; the company matched its year-ago results for the quarter. The stock closed down, though, lower by $6, or 12.8%, to $40.94.

Mergers, acquisitions and joint ventures

SBC Communications

(SBC)

said that

Lucent

(LU)

won a contract -- valued at more than $1 billion -- to be SBC's main equipment supplier for its national network expansion. SBC closed up $2.13, or 4.1%, to $53.56, while Lucent was up 19 cents, or 0.6%, to $33.13.

After Wednesday's Close

Pipeline company

Kinder Morgan

(KMI) - Get Report

said it would contribute assets to

Kinder Morgan Energy Partners

(KMP)

, a pipeline partnership, in exchange for $300 million in cash and equity. Kinder Morgan closed down 38 cents, or 0.9%, to $39.94; Kinder Morgan Energy Partners was down 31 cents, or 0.7%, to $47.

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Earnings/revenue reports and previews

Retailer

J.C. Penney

(JCP) - Get Report

warned that it doesn't expect to meet analyst estimates for the third quarter. The 12-analyst estimate was for earnings of 10 cents a share; the company said it sees results ranging from a small profit to a loss. The company's September same-store department sales were down 4%.

J.C. Penney cited problems at its Eckerd drugstore chain, saying September same-store sales fell 8.8% and that it expects to post a third-quarter operating loss for the chain. J.C. Penny blamed weakness in the drugstore division as part of the reason for the shortfall, but it also called the overall retail environment "challenging."

On the flip side, retailer

Talbots

(TLB)

had better news, saying its September same-store sales jumped 24.8%. The upscale retailer sees third-quarter earnings of $1.00 to $1.02 a share, well above the 14-analyst estimate of 85 cents and the year-ago earnings of 63 cents.

J.C. Penney closed down $1.13, or 10.1%, to $10.06; Talbots closed up $7.06, or 10.7%, to $73.

Hudson United

(HU)

closed down $5.56, or 20.8%, to $21.13 after saying it expects third-quarter earnings to miss expectations because of slower revenue growth and an unplanned increase in operating expenses. The company expects earnings of 50 cents to 52 cents; the five-analyst estimate was for 63 cents.

Unocal

(UCL)

closed down 19 cents, or 0.5%, to $34.81 after saying it sees third-quarter EPS between 90 cents and 95 cents a share, well above the 16-analyst estimate of 78 cents. The company's previous EPS estimate was for 70 cents.

After Wednesday's Close

American Eagle Outfitters

(AEOS)

said

same-store sales rose 7.4% for the five weeks ended in September compared with the same period a year ago. The company's stock closed up 88 cents, or 2.6%, to $34.50.

Breakaway Solutions

(BWAY) - Get Report

closed down $2.94, or 39.2%, to $4.56 after saying that third-quarter losses will exceed estimates due to delayed or scrapped projects and fewer dot-com opportunities. The company said it sees a loss of 2 cents to 4 cents a share, wider than the 12-analyst estimate of a 1 cent loss.

W.R. Hambrecht

cut its rating on the stock to a buy.

Gap

(GPS) - Get Report

said same-store sales fell 8% in September as increased markdowns drove down margins and the company struggled with inventory backlog at its Old Navy division. This morning,

Credit Suisse First Boston

cut Gap's 2000 EPS to $1.15 from $1.25. The Gap didn't fall into it, though, and ended the day up $1.31, or 6.6%, to $21.19.

Guess?

(GES) - Get Report

said its September same-store sales were down 3.1%. It closed flat at $10.

Telecommunications systems provider

Harmonic

(HLIT) - Get Report

said it expects to report a third-quarter loss, falling well short of the six-analyst expected profit of 12 cents. The company blamed the shortfall on a sales slowdown and said it sees a loss between 6 cents to 9 cents. The stock ended the day down $9.88, or 43.3%, to $12.94.

Textbooks and educational materials publisher

Houghton Mifflin

(HTN)

ended the day lower by $3.94, or 10.4%, to $34 after saying its third-quarter earnings will miss estimates but improve over year-ago results. The company said slow sales to elementary and secondary schools are behind the shortfall. The seven-analyst estimate calls for $3.96, while Houghton Mifflin sees earnings of $3.35 to $3.40.

Hughes Electronics

(GMH)

said it expects third-quarter cash flow from operations in line with analyst expectations. The company said it expects to report quarterly revenue of $1.65 billion to $1.7 billion.

Hughes also said its

DirecTV

unit added 450,000 net customers to its high-power satellite TV service in the third quarter, bringing the total number of subscribers to 9 million. Hughes closed down $2, or 6.2%, to $30.50.

Home-product maker

Masco

(MAS) - Get Report

closed down $2.38, or 12.7%, to $16.38 after warning it sees lower-than-expected earnings in 2000 and 2001, citing weak incoming orders and a strong dollar. Masco expects to report earnings of about 41 cents, compared with the 16-analyst estimate of 43 cents. If the same business climate continues, Masco said, fourth-quarter earnings could fall 10% below the 15-analyst estimate of 41 cents. Earnings in 2001 might also be 10% below the estimate, which was for $1.87 a share.

Goldman Sachs

cut Masco to market performer and removed it from the firm's recommended-for-purchase list. Goldman also reduced Masco's 2000 EPS estimate to $1.57 a share from $1.65 and 2001EPS outlook to $1.70 a share from $1.85.

Newmont Mining's

(NEM) - Get Report

chairman said the company won't meet the 12-analyst consensus estimate of a 12 cent per share profit for the third quarter. The stock closed down 88 cents, or 5.4%, to $15.25.

Pitney Bowes

(PBI) - Get Report

ended the day down $10.13, or 28.4%, to $25.50 after saying its third-quarter earnings will be 62 cents to 63 cents a share, missing the nine-analyst estimate of 65 cents. The company also lowered its full-year 2000 earnings projection to $2.44 to $2.48 a share, citing competition in the office-products sector and weakness of foreign currencies.

The nine-analyst estimate calls for $2.58 a share. Pitney Bowes said heightened competition has led to increased margin pressure; the company also blamed foreign currency weakness and softer-than-anticipated results in certain segments.

This morning, Pitney Bowes was downgraded to market performer from market outperformer at Goldman Sachs, which also cut its 2000 EPS estimate to $2.44 a share from $2.60 and its 2001 EPS estimate to $2.75 a share from $2.90.

RSA Security

(RSAS)

said it expects to report third-quarter revenue of about $72 million, a 29% rise over the same quarter last year. RSA also said it expects third-quarter earnings of 24 cents, up from 18 cents in the year-ago period, and just above the 11-analyst estimate of 23 cents.

The company also said its board authorized the company to repurchase up to an additional 4 million shares of its common stock over the next 12 months. RSA stock closed up $5.69, or 14.4%, to $45.19.

Ruby Tuesday

(RI)

closed up 6 cents, or 0.5%, to $11.94 after it announced that first-quarter profits rose 25%, topping Wall Street estimates. The restaurant chain posted earnings of 20 cents a share, topping the seven-analyst 19-cent estimate and the year-ago 16-cent result.

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Analyst actions

Salomon Smith Barney

initiated coverage of 23 bank stocks this morning, recommending a slightly overweight position but also advising selectivity, since it views many banks as low-growth companies. It expressed concern about credit quality and sector rotation. Among stocks commented on, seven were rated buys, four as outperforms, and 12 as neutrals, including:

Bank One

(ONE) - Get Report

: OUTPERFORM; price target: $45. The stock closed up 13 cents, or 0.3%, to $37.13.

Chase Manhattan

(CMB)

: BUY; price target: $75. Chase ended the day down $1.13, or 2.5%, to $44.44.

FleetBoston

(FBF)

: BUY; price target: $52. The stock closed up 75 cents, or 1.9%, to $39.63.

Upgrades

America Online

(AOL)

: UP to strong buy from buy at

ING Barings

. AOL closed up $2.85, or 4.9%, to $61.50.

Colgate-Palmolive

(CL) - Get Report

: UP to intermediate-term accumulate from neutral at

Merrill Lynch

. The stock ended the day up $2.68, or 5.7%, to $49.61.

Gillette

(G) - Get Report

: UP to intermediate-term accumulate from neutral at Merrill. Gillette closed up $1.25, or 4.2%, to $31.19.

i2 Technologies

(ITWO)

: 12-month price target UP to $215 from $175 at

Wit Soundview

. The stock closed up $10.06, or 6.3%, to $169.44.

St. Jude Medical

(STJ)

: UP to market outperformer from market performer at

Goldman Sachs

. The stock ended the day up $1.94, or 3.9%, to $51.63.

TCF Financial

(TCB)

: price target UP to $47 from $38 at

Lehman Brothers

. The stock closed up 13 cents, or 0.3%, to $38.63.

Downgrades

BMC Software

(BMCS)

: 2001 EPS estimate to 85 cents a share from $1.43 at Goldman. BMC ended the day up $1.06, or 6.4%, to $17.56.

Hughes Electronics

(GMH)

: DOWN to outperform from strong buy at

Morgan Stanley Dean Witter

. As noted above, Hughes closed down $2, or 6.2%, to $30.50.

Martin Marietta

(MLM) - Get Report

: DOWN to outperform from buy at Salomon; and it was cut from Goldman's U.S. recommended-for-purchase list. The stock closed up 22 cents, or 0.6%, to $34.45.

Charles Schwab

(SCH)

: third-quarter EPS estimate DOWN to 12 cents a share from 15 cents at Salomon; fourth-quarter EPS estimate to 18 cents a share from 21 cents; and 2001 EPS estimate to 83 cents a share from 90 cents. Schwab closed up 75 cents, or 2.2%, to $34.38.

Initiations

Marine Drilling

(MRL)

: NEW neutral at Lehman. The stock ended the day down 63 cents, or 2.4%, to $25.44.

Group Moves

Morgan Stanley started coverage of toy companies

Hasbro

(HAS) - Get Report

and

Mattel

(MAT) - Get Report

. Both were started with neutral ratings. Hasbro closed flat at $11.19, and Mattel was down 13 cents, or 1.1%, to $11.50.

Lehman downgraded

Firstar

(FSR)

and

U.S. Bancorp

(USB) - Get Report

to neutral from outperform. The firm said "concerns about execution risk and slower growth rates might limit Firstar's near-term upside." Firstar ended the day down 75 cents, or 3.8%, to $19.25; U.S. Bancorp was down $1.25, or 5%, to $23.75.

Salomon cut its recommendation on two office supply retailers:

  • Staples (SPLS) : DOWN to neutral from buy, price target: DOWN to $16 from $28. Staples closed down 81 cents, or 5.8%, to $13.25.
  • OfficeMax (OMX) : DOWN to neutral from outperform, price target: DOWN to $4 from $13. OfficeMax ended the day down 38 cents, or 13.6%, to $2.38.

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Offerings and stock actions

CheMatch.com

withdrew its planned $50 million IPO, citing market conditions.

The company -- an online market for buyers and sellers of chemicals, plastics and fuel products -- was planning to offer 5 million shares in a price range of $10 to $20 a share. It had applied to be listed on the Nasdaq under the ticker "CHEM."

Hospital operator

Community Health Systems

(CYH) - Get Report

said it filed to offer 18 million shares of common stock. The company ended the day down $1.19, or 3.9%, to $29.

Genentech

(DNA)

said it approved a 2-for-1 stock split with Oct. 17 as the record date. The stock closed down $1.38, or 0.8%, to $171.06.

After Wednesday's Close

TNPC

(NPW)

priced its 24 million share public offering at $21 a share, above the estimated $18 to $20 range.

Credit Suisse First Boston

was the underwriter. The company was formed by

Enron

(ENE)

and, through its subsidiary

The New Power Co.

, plans to become the first nationally branded provider of electricity and natural gas to U.S. residential and small commercial customers. TNPC closed up $6, or 28.6%, to $27; Enron was down 6 cents, or 0.1%, to $83.

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Miscellany

priceline.com

(PCLN)

, which matches buyers and sellers of goods and services on the Internet, shut down its

WebHouse Club

gas-and-groceries licensee. The news sent shares of priceline down about 33%.

Priceline WebHouse Club, a privately held licensee that enables consumers to name their own price for gasoline and groceries, will wind down operations over the next 90 days. priceline.com said none of the services it offers, including airline tickets, hotel rooms, mortgages, rental cars and long-distance services, will be affected.

WebHouse customers with unredeemed gas and groceries will receive a full refund of any prepaid amount, plus extra money to cover the estimated savings they were expecting to receive at the grocery store and gas pump.

TheStreet.com

covered the closing more in depth in a separate

story. priceline.com ended the day down $3.56, or 38%, to $5.81.

Optical giant

Corning

(GLW) - Get Report

announced that it has established a $50 million venture capital group to invest in optical technologies. Corning closed down 44 cents, or 0.5%, to $96.94.

Nextel Communications

(NXTL)

said that it added more than 540,000 domestic subscribers in the third quarter. In addition, the wireless telephone company announced that its average monthly revenue per subscriber met or exceeded average revenues in the second quarter. Nextel ended the day down $5.38, or 12.3%, to $38.44.

After Wednesday's Close

Boeing

(BA) - Get Report

said it delivered 117 commercial jets in the quarter ending Sept. 30, boosting its total to 359 through the first nine months of the year. The company said it was on pace to meet its full-year goal of 490 deliveries. The airplane-maker closed down 6 cents, or 0.1%, to $61.06.

Chevron

(CHV)

said an error in calculation at a closely watched natural gas well in northern Canada led the company and its partners to believe it was having production problems last month. Chevron said the well produced gas at 85 million cubic feet a day between Sept. 9 and Tuesday, not 60 million as previously reported. Chevron ended the day up 69 cents, or 0.8%, to $85.50.

Hyseq

(HYSQ)

CEO George Rathmann said his genomics company plans to ask U.S. regulators by late 2001 for permission to begin human tests for two of its first two experimental medicines, one to prevent blood clots and the other to treat inflammatory diseases. Hyseq closed down 31 cents, or 0.96%, to $32.25.

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By the Numbers

The data on NYSE and Nasdaq percent winners and losers are filtered to exclude stocks whose previous day's volume was less than 25,000 shares; whose last price was less than 5; and whose net change was less than 1/2.

Dow point gain and loss data are based on New York closing prices and do not reflect late composite trading.

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