Tech Stocks Left Hanging
SAN FRANCISCO -- Shaky bonds and an even shakier 3Com (COMS) kept tech buyers at bay much of the day.
After issuing an earnings warning on Tuesday, 3Com shares tumbled 9%, closing 2 7/16 lower at 24 9/16. While 3Com's woes did not drag down the entire sector, they were a factor that kept investors from buying aggressively.
3Com's news was somewhat offset by strength in
Intel
(INTC) - Get Report
following some positive
words on the company from
Morgan Stanley Dean Witter's
Mark Edelstone. Intel closed up 4 7/8, or 4.4%, at 114 11/16.
The mixed results for 3Com and Intel summed up what went on throughout the tech sector. There appeared to be no compelling reason to buy or sell, hence only a small gain on the
Nasdaq
.
Net Stocks Mixed
Those that bought
eBay
(EBAY) - Get Report
ahead of its stock split Monday have been handsomely rewarded. The stock continues to push higher, closing 6 7/16 higher, or 5.5%, at 123 1/2 after trading to an all-time high post-split of 125. It has almost doubled in price from the 64 (or 192 pre-split) level it was trading at on Feb. 10.
On the downside,
Network Solutions
(NSOL)
closed off 7 1/2 at 161 1/2. But losses came on relatively light volume of 624,500 shares vs. the average volume of 800,000, and has come a long way since trading as low as 127 on Feb. 18.
Among the day's big percentage losers was
Manhattan Associates
(MANH) - Get Report
, which provides consumer supply chain execution systems. The stock fell more than 40% on earnings concerns, closing 6 7/8 lower, or 43%, at 9.
Reuters
reported that
J.C. Bradford
cut its rating on the stock to neutral from buy due to its earnings outlook for the first quarter.
CS First Boston
also downgraded the stock to hold from buy, according to
Bloomberg
.
SAP Hits 52-Week Low
Shares of
SAP
(SAP) - Get Report
hit a 52-week low after the company announced its president of North American operations was
leaving.
After 10 years at SAP, Jeremy Coote left SAP to join
Siebel Systems
(SEBL)
as general manager of Siebel America.
"We're very disappointed Jeremy left but from what I was told, it was a very lucrative deal," SAP CEO Kevin McKay said in a phone interview. He said SAP would not be replacing Coote. Instead, McKay would take on the additional title and responsibilities of president of North American operations.
Coote had said part of the reason he had left SAP was that the German enterprise software giant did not have the type of lucrative stock options plan that other high-tech companies offer to retain employees. Instead, SAP has a worldwide "stock appreciation program" that regularly pays a bonus based on the amount SAP shares appreciate from a specified base.
McKay admitted that many of those grants were "underwater right now" with the stock losing more than half its value since mid-1998, but that a new 1999 plan expected to be issued next week "will be sweetened a bit." But he reiterated that, on the whole -- taking base salaries, vacation time and bonuses into account -- SAP remains very competitive with other high-tech companies.
Analysts have noted many SAP defects over the past several months, with departures heating up now that SAP has ended its fiscal year and handed out year-end bonuses. McKay brushes that off and suggests that "maybe that's a coincidence."
"We're concerned any time we lose any good employees, but we don't feel for our future." McKay said. He reiterated that he expects to the company's revenues to double in three years, meaning that revenues this year would have to grow 25% year over year. He also said he still expected growth to be led by the Americas and Europe, with Asia being about flat.
--
Medora Lee
