Expect the following technology stocks to be among Thursday's most actively traded issues: Dell, Computer Associates, Concentric Network, Fashionmall.com, Luminant Worldwide and Rhythms NetConnections.
Expect Dell to see lots of action Thursday ahead of its third quarter earnings report.
First Call consensus predicts a profit of 18 cents a share. That figure was revised downward after company officials warned that rising memory prices would erode profit margins in the quarter.
While analysts were quick to lower their consensus estimate from 20 cents a share to 18 cents, most are convinced the squeeze on gross profit margins will be temporary and that strong PC demand will help push the stock higher through 2000.
Dell officials said a supply shortage for some memory components and liquid-crystal displays used in notebook computers meant memory prices jumped as much as 25 percent in the quarter.
Despite the profit warning, Dell shares only fell about $6 a share and were trading around $41 a share Wednesday afternoon.
"Dell's still the company to beat in this space," said Jonathan Ross, an analyst at ABN AMRO. "They have a great business model. This is likely a one-time event that will have no affect on valuation going forward."
Ross said he's expecting a third-quarter profit of 18 cents a share on sales of $6.6 billion, roughly a 37 percent improvement from the year-ago quarter. Last quarter, Dell beat Street estimates by 2 cents a share, earning $507 million, or 19 cents a share, on sales of $6.14 billion.
Analysts were also encouraged by management's claims that the Y2K dilemma wouldn't hamper its sales through the rest of the fiscal year.
Ashok Kumar, an analyst at Piper Jaffray, said Dell should be able to sustain a 30 percent to 35 percent revenue growth and that all indicators point toward strong demand through fiscal 2000.
Dell shares closed up 7/8 to 41 7/16 Wednesday.
The software company said it would appeal a ruling yesterday by a Delaware judge ordering its top three executives to return more than $550 million of stock they were awarded last year. Computer Associates rose 2 1/8 to 60 13/16.
The provider of Internet and Web-hosting services said its board adopted a shareholder plan intended to prevent a hostile takeover. Concentric shares closed up 3/4 to 32 7/8.
Fashionmall.com might get a boost after it posted a smaller-than-expected loss in its third quarter Wednesday, losing $1 million, or 14 cents a share, on sales of $889,000.
Its shares closed up 7/16, or 7 percent, to 6 3/4 ahead of the earnings report.
First Call consensus expected it to lose 23 cents a share in the quarter.
The $889,000 in sales represents a 36 percent improvement compared to the year-ago quarter when it earned $203,000, or 5 cents a share, on sales of $653,000.
Fashionmall.com shares soared to a high of 15 7/8 shortly after its initial public offering in May. The stock hit a low of 4 1/4 in October.
One of the two analysts following the stock rates it a "buy" while the other calls it a "hold."
First Call consensus expects Fashionmall.com to lose 66 cents a share in the fiscal year.
Luminant Worldwide beat Street estimates by 2 cents a share in its third quarter Wednesday, earning $983,000, or 4 cents a share, on sales of $26.4 million.
First Call consensus expected the e-commerce professional services firm to earn 2 cents a share.
Its shares closed up 5 15/16, or 13 percent, to a 52-week high of 50 5/8 ahead of the earnings report.
The $26.4 million in sales marks a 97 percent improvement compared to the year-ago quarter when it lost $710,000, or 3 cents a share, on sales of $13.4 million.
"We are extremely pleased with our strong third quarter results -- our first quarter as a publicly traded company," said Gil Marmor in a prepared release. "We exceeded all of our operational objectives, entirely through organic growth, with significant new client wins and further development of existing relationships."
Luminant shares fell to a low of 25 in September.
Rhythms NetConnections shares should soar Thursday after it topped analysts' estimates in its third quarter, but still lost $61.7 million, or 89 cents a share, on sales of $3.3 million.
First Call consensus expected it to lose 97 cents a share in the quarter.
Its shares closed up 4 7/16, or 11 percent, to 44 7/16 ahead of the earnings report.
In the quarter, Rhythms operated 6,700 DSL lines, up 106 percent from the 3,250 lines in the second quarter.
Its high-speed data transmission service was available in 27 metropolitan areas, up 59 percent from the 17 markets it served in the second quarter.
"We exceeded our third quarter objectives for revenue, lines in service and central office deployment and have achieved our 1999 national coverage goals well ahead of schedule," said CEO Catherine Hapka in a prepared release.
Company officials said it will expand to another 20 markets in fiscal 2000, giving it a total of 70 markets,
Its shares hit an all-time high of 111 1/2 shortly after its initial public offering
in April. Its shares fell to a low of 26 1/16 earlier this month.
Six of the seven analysts tracking the stock maintain either a "buy" or "strong buy" recommendation.
First Call consensus expects it to lose $3.09 a share in the fiscal year.