STOCKS TO WATCH: Etec Systems, Lattice Semiconductor and Teligent

The semiconductor-equipment maker announced late Wednesday that it was awarded a $14.2 million contract by the Defense Advanced Research Projects Agency contracted through the Space and Naval Warfare Systems Center.

The contract is part of a three-year cost sharing agreement expected to total approximately $28 million, which will advance Etec's research into microcolumn and multisource electron-beam technology for advanced semiconductor manufacturing lithography and military microelectronics applications for mask patterning and wafer direct write.

Its shares closed off 7/8 to 36 11/16 Wednesday.

The chipmaker's recent stock surge has convinced its board of directors to split the stock 2-for-1 on Sept. 16 for all shareholders of record on Aug. 26.

Wednesday's announcement marks the second stock split in the history of Lattice, which previously divided its stock in 1993.

"This stock split should benefit our stockholders and the Company by broadening our stockholder base and improving the liquidity of the market for our stock," stated Cyrus Y. Tsui, president and CEO.

The move comes as Lattice trades close to is 52-week high, with the stock closing Wednesday up 4 to 62 7/8. The stock was recently upgraded to "buy" from "outperform" by Lehman Bros. analyst James Barlage, who set a 12-month price target of $85 per share.

The telecommunications provider posted a smaller-than-expected loss in its second quarter Wednesday, losing $123 million, or $2.34 a share, on sales of $4 million.

First Call consensus expected it to report a loss of $2.45 a share.

Its shares closed up 5 11/16, or 10 percent, to 64 ahead of the earnings report.

The $4 million in sales represents a 250 percent improvement compared to the first quarter when it lost $108 million, or $2.05 a share, on sales of $1.5 million.

In the quarter, Teligent raised its year-end target for securing access rights to customer buildings by 20 percent, from 5,000 to 6,000 buildings.

"By every measure, we had an excellent second quarter," said CEO Alex Mandl in a prepared release. "We dramatically increased our revenue, and we significantly improved our numbers for `on-net' buildings, customers and customer lines."

Teligent shares hit a 52-week high of 75 7/8 in July after falling to a low of 18 ? last August.

First Call consensus expects it to lose $9.80 a share in the fiscal year.