STOCKS TO WATCH: Applied Micro Circuits, Oracle, SBC
Expect the following technology stocks to be among Friday's most actively traded issues: Applied Micro Circuits, Oracle and SBC Communications.
This one will be interesting to watch Friday after it cut its fourth-quarter sales estimates Thursday afternoon only to watch its stock rebound to post a decent gain in the final hour of trading.
Chief Executive Officer Dave Rickey went on CNBC to warn the communications chipmaker will post sales of between $125 million and $135 million in the quarter, well below the $175 million expected by most analysts.
Rickey blamed profit warnings from some of its largest customers, which includes Cisco, Lucent and Nortel, for the shortfall.
However, the stock closed up $2.81 to $29.56 after spending most of the day in the red ahead of Rickey's confession.
Given a little longer to mull the situation, investors pushed the stock down to $28.57 in after-hours trading.
Everyone saw this coming.
The database and e-business application software vendor finally came clean after the bell Thursday, telling investors what analysts had been saying for weeks: It will miss sales and earnings estimates this quarter.
Blaming order cancellations and waning spending by its top customers, Oracle told the Street to expect earnings of 10 cents a share in the quarter.
Analysts were expecting a profit of 12 cents a share.
In a conference call with analysts, Oracle executives said they were worried about the deteriorating economy and did not give final approval on sales figures as the company wrapped up its fiscal third quarter Wednesday.
"On Friday we started seeing a few cracks," said CFO Jeff Henley. "On Wednesday we just had a significant amount of deals that were deferred."
Oracle said its operating income would be about $900 million, compared with Wall Street's forecast of $1 billion. It will provide more detailed fourth-quarter financial guidance when it reports third-quarter earnings on March 15.
The stock closed up $2.38 to $21.38 ahead of the warning before plunging to $17.03 in after-hours trading.
SBC Communications figures to slump Friday after warning its first-quarter profits will fall short of Wall Street's expectations because of costs to roll out new services such as high-speed Internet access and long-distance service, and improve service quality in its Ameritech unit.
As a result of these expenses, SBC expects first-quarter 2001 earnings per share to be in the range of 50 cents to 53 cents.
Analysts were expecting a profit of 59 cents a share in the quarter.
The stock closed off $2.20 to $45.50 ahead of the warning before falling to $44 in after-hours trading.