STOCKS TO WATCH: Applied Materials, Dell, H-P and Splitrock Services

The chip-equipment maker figures to see strong volume Tuesday ahead of its third quarter earnings report.

Coming off a spectacular second quarter, Applied Materials looks to build on the momentum that's helped its stock triple in the past 10 months.

Last quarter, the world's largest chip-equipment maker raked in $141.6 million, or 36 cents a share, on sales of $1.1 billion. That was 9 cents better than First Call estimates.

With chip sales expected to grow by 20 to 25 percent this year, Applied appears to be in good shape through the end of the calendar year.

Its shares peaked at 19 15/16 in July after bottoming out 21 9/16 in October.

First Call consensus expects it to earn 53 cents a share in its third quarter and $1.61 a share in the fiscal year.

Its shares closed up 3/4 to 70 1/2 Monday.

Some analysts are worried that intense pricing pressure in the PC industry will derail any great explosion in its earnings or stock price.

First Call consensus is looking for a profit of 17 cents a share in its second quarter, up from the $434 million, or 16 cents a share, it earned in the first quarter on sales of $5.54 billion.

Despite those concerns, Dell's stock isn't exactly hurting.

Shortly before splitting 2-for-1 in March, Dell shares were hovering at $55 a share. On Friday, it closed up 1 3/16 to 41 7/16.

Twenty of the 33 analysts following Dell rate it either a "buy" or "strong buy."

The stock closed unchanged at 41 7/16 Monday.

H-P blew past analysts' estimates in its third quarter Monday, earning $853 million, or 85 cents a share, on sales of $12.2 billion.

First Call consensus pegged it for a profit of 80 cents a share in the quarter.

Investors built a lot of good news into the stock already. Shares of HP gained 4 5/16 to 110 5/16 in regular trading Monday prior to the earnings report. Hewlett-Packard's stock price has risen nearly 7 percent since Thursday.

"We executed very well on many fronts," CFO Bob Wayman said during an afternoon conference call. "We feel good about our progress on revenue growth and even better about our profitability."

Third quarter revenues increased to $12.2 billion from $11 billion in the year earlier period, when Hewlett-Packard earned $621 million, or 58 cents per share. The computer and imaging business, which generates the bulk of Hewlett-Packard's revenue, picked up 12 percent to $10.3 billion.

Hewlett-Packard saw especially strong growth in servers and notebook computers. Storage sales dropped as HP continued its previously announced plans to concentrate on high-end systems. HP's consulting business saw weaker demand from previous quarters.

The data communications service provider was started with a "buy" recommendation by CS First Boston late Monday.

After it's less-than-spectacular IPO earlier this month, Splitrock shares fell to a low of 8 15/16.

CS First Boston analyst John Doughty set a 12-month price target of $18 a share.

The stock closed off 1/8 to 9 5/8 Monday.