SAN FRANCISCO -- Yahoo! (YHOO) posted first-quarter earnings that beat Wall Street estimates, coming in at 11 cents a share.
The profit beat the Street's official estimate of 8 cents a share and its 10-cent unofficial target, or whisper number. The company said revenue nearly tripled to $86 million from $30.2 million a year ago, in line with analysts'
Ahead of its earnings report, Yahoo! closed down 6 7/16, or 3%, at 208 7/16.
reported that the stock was trading around 211 after hours.
But even strong earnings don't necessarily guarantee gains in Yahoo! stock, particularly after the surge since the company's agreement last week to buy
. Profit-taking hit the stock in January after the company reported fourth-quarter earnings that also beat estimates, and traders were likely taking profits today in anticipation of a similar trade tomorrow.
Craziest story of the day had to be the one regarding
. The stock rose around 31% at one point in the day following what turned out to be a fake report that it was going to be acquired by
A note that the company was being acquired was posted on a Yahoo! message board, bearing a link to what appeared to be a
site, though the news agency did not have a story to that effect. PairGain denied the story and ECI's offices in Israel were closed for Passover.
PairGain traded to a high of 11 1/8 and still closed 7/8 higher, or 10%, at 9 3/8.
Finding a Solution
gave back gains late in the day along with other Internet stocks. The stock had rallied as high as 126 23/32 after
reiterated a strong buy on the stock and raised its price target to 188 from 125. It closed unchanged at 115 1/2.
In the report, analyst Paul Merenbloom writes that the shares have been "unfairly pushed around by the press, who have not taken the time to understand the contractual and technical issues at hand, and by short-sellers working the momentum angle." Merenbloom also went out on a limb and predicted that the mid-April target date for competitive access is neither attainable nor technically feasible.
But the report fails to address the two most pressing issues facing Network Solutions today: Lack of certainty over its pricing structure and the identity of its competitors, who will be selected as participants in a test phase to open up the domain name business.
published a piece on these issues
Merenbloom's report also seems to overestimate Network Solutions' power by stating in its headline that "ICANN Needs NSOL's Blessing to Proceed." More specifically, Merenbloom notes that in order to compete, the soon-to-be-announced registrars must have contracts with Network Solutions. Although Merenbloom says that no such agreements exist, the
has said that it will have resolved this issue and other technical and financial terms of the relationship before April 26, the target date to establish the competitive test bed.
-- Spencer E. Ante
Speed is Everything
closed up 3 11/16, or 2.3%, at 165 13/16 after the company said it entered agreements with two Japanese companies to provide high-speed Internet access through cable television lines in Japan.
And in a related story,
(RTHM:Nasdaq), which provides high-speed data access over telecommunications networks, ran wild in its initial day of trading. Rhythms NetConnections was priced at 21, opened at 56 and traded as high as 75. It closed up 48 1/8, or 229%, at 69 1/8.
Movers and Shakers
Yahoo!'s earnings had much of the focus today, but an earnings warning from
after the close on
Tuesday sent shares tumbling today. Network Associates closed down 5 15/16, or 27%, at 16, contributing to weakness in the Nasdaq today.
In what should come as no surprise, shares of
rallied hard after the company announced a 2-for-1 stock split. They closed up 21 7/8, or 24%, at 111 1/2.