IBM -- the New Internet Player
SAN FRANCISCO -- Some are talking up IBM (IBM) - Get Report as an Internet play, and with moves like today's 15-point gain, it's no wonder. And the stock's strength is moving actual Internet plays.
CMGI
(CMGI)
, which invests in Internet companies, has entered into a strategic alliance with
Gateway
(GTW)
. Gateway will invest $200 million for an ownership stake in CMGI, joining
Microsoft
(MSFT) - Get Report
and
Intel
(INTC) - Get Report
, which hold minority positions in the company. Gateway and CMGI will seek out collaborative business and investment opportunities on the Internet.
CMGI was trading up 2 1/8, or 1%, at 241 7/8.
Shares of
Lycos
(LCOS)
continue to flourish following Wednesday's confirmation that its merger with
USA Networks
(USAI) - Get Report
was off. The general feeling is that Lycos remains a potential buyout candidate, but at a higher price than USA was going to pay. Lycos was up 3 4/3, or 3.5%, at 110 3/4.
Lycos also is getting help today from an upgrade by
Jefferies & Company
, which raised Lycos to buy from hold with a price target of 150. Jefferies speculates that
Time Warner
(TWX)
is a potential candidate with Internet assets to do a deal with Lycos, similar to those done by
NBC
and
Xoom.com
(XMCM)
and
Disney
(DIS) - Get Report
and
Infoseek
(SEEK)
. However, they note, they do not expect any "big" Lycos deals to be announced soon as Lycos has agreed to pay USA a $35 million breakup fee if it announces a deal before July 15.
On the IPO front, shares of
Copper Mountain Networks
(CMTN:Nasdaq), a DSL-based Web access component maker, have surged in its first hour of trade. Copper Mountain Networks was up 49, or 233%, at 70, soon after it began trading. (See
In the Fifth Week, PairGain Rises Again for more on Copper Mountain and digital subscriber line technology.)
Daily Dose of Fiber
Fiber-optic component suppliers are on a tear, although one company is sitting out the party.
Uniphase
(UNPH)
shares have climbed 3 to 145 3/8 today and are up 15% since Monday. On Wednesday Uniphase said Canadian regulators have cleared its merger with
JDS Fitel
. Its peer
SDL
(SDLI)
is up 2 to 125 today, and up 13% since Monday.
Then there is the upstart
E-Tek
(ETEK)
, whose stock is down 1 1/2 to 41 1/2 for the day and down 15% since Monday. One possible reason: Insiders are unloading stock. According to filings with the
Securities and Exchange Commission
, Chairman Michael Fitzpatrick sold 350,000 shares on April 26, reducing his stake to roughly 2.5 million shares.
A prior
story in
TSC
described the high-octane sales of optical components to network systems companies such as
Lucent
(LU)
and
Ciena
(CIEN) - Get Report
.
Kevin Petrie
Ramming Along
Shares of
Rambus
(RMBS) - Get Report
are up for the sixth straight session. The stock may be seeing a short squeeze as investors await indications on whether Intel will roll out its Rambus-based chipsets in September. It was up 3 19/32, or 5%, at 79 1/8.
