Thursday's Winners & Losers: Rational Software, Aurora, Cisco, Yahoo!, CNet - TheStreet

Updated from 11:33 a.m.

Yahoo!

(YHOO)

reported fourth-quarter earnings that met analysts' expectations, but revenue fell short of the figure Wall Street wanted. Then the company really went for broke. For 2001, the company projected earnings of 33 cents to 43 cents a share on revenue of $1.2 billion to $1.3 billion. Yahoo! forecast first-quarter earnings of 4 cents to 7 cents a share. According to First Call/Thomson Financial, analysts are expecting earnings of 13 cents a share for the first quarter, and a profit of 57 cents a share on revenue of $1.42 billion for the year.

Market watchers were expecting the Santa Clara, Calif., Internet media and content company to earn 13 cents a share for the fourth quarter, according to First Call, and Yahoo! didn't disappoint in that regard, hitting the number on the head. The company earned 9 cents a share in the year-ago period.

Yahoo! said total fourth-quarter revenue rose 53% to $310.9 million from $203.1 million in the same period a year ago. Analysts were looking for revenue of $315.1million. The company reported a top line of $295.6 million in the latest third quarter. Yahoo! closed down $4.63, or 15.2%, to $25.88.

Mergers, acquisitions and joint ventures

Unisys

(UIS) - Get Report

, software giant

Microsoft

(MSFT) - Get Report

and PC maker

Dell

(DELL) - Get Report

are joining forces to create a new voting technology to replace outdated systems that yielded such irregularities as those that happened most recently in Florida.

The new system will integrate election processes from voter registration to counting results. Unisys closed up $2.19, or 14.4%, to $17.38; Microsoft was up $2.13, or 4%, to $55; and Dell was up $1.50, or 7%, to $22.81.

After Wednesday's Close

Honeywell

(HON) - Get Report

said Wednesday its shareholders had approved the company's plan to merge with

General Electric

(GE) - Get Report

. The deal is now valued at $35.64 billion. Honeywell said 74% of its shares were voted in favor of the merger, which the companies expect to close in the first quarter. Honeywell closed up $2.19, or 4.8%, to $47.38; GE was up $1.88, or 4.2%, to $46.56.

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Earnings/revenue reports and previews

Shaw Group

(SGR)

posted first-quarter earnings of 31 cents a share, beating the six-analyst estimate of 28 cents a share and up from year-ago earnings of 22 cents a share. The stock closed up $1.63, or 3.6%, to $46.94.

After Wednesday's Close

Airborne

(ABF)

warned after the bell today to expect a sharply wide fourth-quarter loss, saying the period was weighed down by higher fuel and weather-related costs, as well as the effect of a slowing economy. The Seattle-based company said it expects to post a fourth-quarter loss of 23 cents to 33 cents a share, compared with earnings of 29 cents a share in the same period last year. According to

First Call/Thomson Financial

, 12 analysts called for a loss of 6 cents a share.

Airborne, which will report fourth-quarter earnings on Jan. 31, also said it will announce a rate increase on an estimated one-third of its domestic business by Feb. 15. The company said it will phase in rate hikes on most of its domestic business over the next several quarters. Airborne closed down 13 cents, or 1.1%, to $11.81.

Macrovision

(MVSN)

did something a little unusual in today's rocky market. After the closing bell, the company raised its earnings and revenue estimates for 2001. The licenser and developer of copy protection and copyright management technologies said it is raising its 2001 revenue forecast to a range of $105 million to $110 million with earnings in excess of $40 million, or more than 80 cents a share. Six analysts polled by First Call are calling for the company to earn 73 cents in 2001, up from the estimate of 60 cents this year. The company didn't address fourth-quarter earnings in its statement, but Wall Street is expecting the company to earn 17 cents a share. Macrovision closed down 38 cents, or 0.6%, to $65.13.

Rational Software

(RATL)

posted third-quarter earnings that beat analysts' estimates by 2 cents, fueled by 47% growth in revenue for the period. The Cupertino, Calif., software company said it earned $40.2 million, or 20 cents a share, excluding amortization and other items, compared with $25.6 million, or 13 cents a share, in the same period last year. Eight analysts polled by First Call produced a consensus estimate of 18 cents a share. Revenue for the quarter rose to $215.5 million from $146.2 million a year ago. Analysts on average had called for third-quarter revenue of $204.1 million. Rational closed up $6.06, or 15.5%, to $45.19.

Animal feed company

Agribrands International

(AGX) - Get Report

reported fiscal first quarter earnings of 48 cents a share, down from $1.29 per share a year ago. The one-analyst First Call consensus forecast was $1.31 per share. Agribrands closed up 13 cents, or 0.2%, to $53.38.

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Analyst actions

Credit Suisse First Boston

said because of cautious comments from

Cisco Systems'

(CSCO) - Get Report

CEO John Chambers at the

Morgan Stanley Dean Witter

investor conference, it was revising its earnings estimates and price target.

The firm said for the January quarter it was now expecting revenue of $7.04 billion from $7.17 billion. For the full-year 2001, CSFB lowered revenue to $28.4 billion from $29.6 billion and its

earnings-per-share estimate to 75 cents from 78 cents. Full-year 2002 revenue was lowered to $37.3 billion from $41 billion and its EPS estimate was knocked down to 96 cents from 98 cents.

To reflect the lower estimates, the firm cut Cisco's 12-month price target to $65 from $87, adding that it still finds the shares attractive and that it reiterates its strong buy rating.

Also, CSFB acknowledged that Cisco has not officially lowered guidance for the quarter or outlook and that the firm might be "overly conservative" in taking down the bottom line number, given Cisco's "ability to react quickly to change." Cisco closed up $2.88, or 7.9%, to $39.13 amid a tech rally that shrugged off most of the sector's bad news today.

Salomon Smith Barney's

Jonathan Joseph cut his first-quarter and full-year earnings view on chipmaker

Intel

(INTC) - Get Report

, citing slowing sales.

Joseph cut Intel's first-quarter EPS outlook to 30 cents from 35 cents and its 2001 EPS estimate to $1.25 from $1.42. And Solly reduced the chipmaker's first-quarter revenue outlook to $7.86 billion from $8.73 billion.

Also,

Merrill Lynch

trimmed Intel and other chipmakers' 2001 EPS estimates. Intel's 2001 EPS estimate was taken down to $1.41 a share from $1.56.

Advanced Micro Devices

(AMD) - Get Report

was lowered to $2.43 from $2.66;

Analog Devices

(ADI) - Get Report

, down to $2.39 from $2.58;

Linear Technology

(LLTC)

, trimmed to $1.41 from $1.48 and

Texas Instruments

(TXN) - Get Report

was cut to $1.40 a share from $1.61.

Intel closed up 38 cents, or 1.1%, to $33.38; AMD was up $1.06, or 6.2%, to $18.19, Analog Devices was up $2.75, or 5.6%, to $51.94; Linear Tech was up $3.75, or 7.4%, to $54.38; Texas Instruments ended the day up $3.19, or 6.9%, to $49.63.

Upgrades

Aurora Biosciences

(ABSC)

: UP to buy from long-term buy at

J.P. Morgan

. Aurora closed up $4, or 17.4%, to $27.

Biovail

(BVF)

: added to

Goldman Sachs'

U.S. recommended for purchase list. Biovail closed up 55 cents, or 1.5%, to $37.49.

Diageo

(DEO) - Get Report

: UP to buy from market perform at

Deutsche Banc Alex. Brown

. Diageo closed up 31 cents, or 0.8%, to $39.13.

Dominion Resources

(D) - Get Report

: 2001 EPS view to $4.15 from $3.90 at CSFB and 2002 EPS view UP to $4.50 from $4.25. Dominion closed down $2.31, or 3.9%, to $56.44.

HealthSouth

(HRC) - Get Report

: 12-month price target UP to $24 from $15 at

UBS Warburg

. HealthSouth closed up 63 cents, or 4.1%, to $15.88.

Downgrades

Cymer

(CYMI)

: 2001 EPS view DOWN to $2.75 from $3.35 at

ABN Amro

. Cymer closed up $2.31, or 7.8%, to $32.13.

FirePond

(FIRE)

: DOWN to long-term attractive from buy at

Robertson Stephens

. It was also downgraded to neutral from buy at

SG Cowen

. FirePond closed down $3.53, or 41.1%, $5.06.

Unifi

(UFI) - Get Report

: DOWN to hold from buy at CSFB; 2001 EPS view DOWN to 20 cents from 71 cents and 2002 EPS view DOWN to 90 cents from $1.50. Unifi closed down 69 cents, or 9.2%, to $6.75.

Initiations

CNet

(CNET) - Get Report

: DOWN to long-term attractive from buy at Robbie Stephens. Also, it was removed from Goldman Sachs' U.S. recommended for purchase list. Cnet closed down $1.56, or 10.3%, to $13.56.

Compass Bank

(CBSS)

: NEW buy at CSFB; 12-month price target: $27. Compass Bank ended the day up 6 cents, or 0.3%, to $24.31.

Wachovia

(WB) - Get Report

: NEW neutral at Solly; 12-month price target: $65. Wachovia closed up 50 cents, or 0.8%, to $64.50.

Group Moves

SG Cowen cut ratings on six electronic business software companies to buy from strong buy. They are:

  • BEA Systems (BEAS) . BEA closed up $4.94, or 8.8%, to $61.19.
  • BroadVision (BVSN) - Get Report. BroadVision closed down 19 cents, or 1.2%, to $15.
  • Rational Software (RATL) . Rational Software closed up $6.06, or 15.5%, to $45.19.
  • Serena Software (SRNA) . Serena closed down 38 cents, or 1.3%, to $29.19.
  • Tibco Software (TIBX) . Tibco closed up $3.38, or 8.5%, to $43.
  • Vignette (VIGN) . Vignette closed up 94 cents, or 7.5%, to $13.44.

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Offerings and stock actions

Newspaper and magazine publisher

Washington Post

(WPO)

said its board approved an increase in its annual dividend to $5.60 from $5.40. The stock closed up $8.88, or 1.5%, to $615.63.

After Wednesday's Close

AltaVista, the majority-owned Internet portal of one-time highflier

CMGI

(CMGI)

, is withdrawing its registration statement for an initial public offering.

The action to not act now provides more evidence -- like we needed it -- that the market for new issues just isn't what it used to be. AltaVista had filed with the

Securities and Exchange Commission

to offer 14.8 million common shares. The company said it was requesting the withdrawal because of continuing unfavorable conditions in the financial markets. CMGI closed up 47 cents, or 9.9%, to $5.19.

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Miscellany

Federal-Mogul

(FMO) - Get Report

, which makes auto parts, named Frank Macher its chief executive and Charles McClure president and COO, effective immediately. Macher replaces Robert Miller, a director who was filling in as interim CEO after Dick Snell resigned abruptly in September. Federal-Mogul closed up 19 cents, or 5.2%, to $3.81.

After Wednesday's Close

Construction materials supplier

Lafarge

(LAF)

is changing the captain of its ship. The company announced today that president and CEO John Piecuch was resigning to be replaced by Philippe Rollier, effective May 8. Lafarge closed down 13 cents, or 0.5%, to $24.13.

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