Tech Industry

STOCKS TO WATCH: Credence Systems, Lucent and Manugistics

Expect the following technology stocks to be among Friday's most actively traded issues: Credence Systems, EMachines, Lucent, Manugistics and Silicon Labs.

  • Credence Systems Corp. (Nasdaq: CMOS)

    Expect Credence Systems shares to catch fire Friday after announcing a 2-for-1 stock split after the bell Thursday.

    Its shares closed up 5 1/16 to 136 9/16 ahead of the announcement.

    Company officials said the split will take effect May 17 for all shareholders of record on May 1. Credence Systems (Nasdaq: CMOS) has more than 24.8 million shares outstanding.

    The maker of automatic test equipment for the semiconductor industry shattered analysts' estimates in its latest quarter, earning $16.9 million, or 71 cents a share, on sales of $101.8 million.

    On Tuesday, ABN AMRO started coverage of the stock with a "buy" recommendation and set a 12-month price target of $160 a share.

    Analysts expect the Fremont, Calif. company to earn 86 cents a share in its second quarter and $3.49 a share in the fiscal year.

    All 11 analysts following the stock maintain either a "buy" or "strong buy" recommendation.

  • EMachines Inc. (Nasdaq: EEEE)

    EMachines priced its 20-million share initial public offering at $9 a share Thursday for trading Friday. The price range was $8 to $10 a share.

    Credit Suisse First Boston is the lead underwriter.

    The company, which made a splash with cheap PCs, initially filed with regulators to go public in August. In January, eMachines acquired FreePC Inc., a Bill Gross idealab! company that subsidized the price of a PC with Internet access and advertising. EMachines (profile) scrapped the FreePC business model, but will use the firm's expertise to gain advertising and direct marketing revenue.

    EMachines reported pro forma 1999 sales (including FreePC) of $815.5 million and a loss of $84.5 million. Sans FreePC, eMachines reported sales of $814.3 million and a loss of $5.7 million. The company sees losses ahead, but did report a slight profit of $2.2 million in the fourth quarter.

  • Lucent Technologies Inc. (NYSE: LU)

    Lucent shares will be active Friday after the network-equipment maker reassured investors that it will meet estimates in its second quarter.

    "We have not changed our guidance for the fiscal second quarter, and we have no plans to change our guidance and we have no plans to issue an earnings warning,'' Lucent spokesman Jeff Baum told Reuters.

    Shares of Lucent, the most widely held U.S. stock, fell sharply early on Thursday after talk circulated of a bogus press release, posted on a Yahoo! message board Wednesday night. The shares then rebounded in the afternoon, closing up 2 5/8 to 65 1/4.

    Lucent has said it expects top-line growth of about 12 percent to 15 percent more than last year's level of $8.78 billion and bottom-line growth of approximately 25 percent to 35 percent more than the 17 cents a share the company earned in the second quarter of fiscal 1999.

    First Call consensus expects Lucent to earn 22 cents a share in the quarter.

  • Manugistics Group Inc. (Nasdaq: MANU)

    Manugistics will attract attention Friday after it posted a smaller-than-expected loss in its fourth quarter, losing $1.1 million, or 4 cents a share, on sales of $43.7 million.

    First Call consensus expected the enterprise software vendor to lose 6 cents a share in the quarter.

    Its shares closed off 1 1/8 to 56 1/2 ahead of the earnings report.

    In the quarter, it recorded licensing revenue of $22 million, up 45 percent from the year-ago quarter when it posted $15.2 million in sales.

    In the year-ago quarter, Manugistics lost $71.2 million, or $2.66 a share, on sales of $40.4 million.

    First Call consensus expects it to earn 17 cents a share in fiscal 2001.

  • Silicon Labs Inc. (Nasdaq: SLAB)

    Silicon Labs priced its IPO at $31 a share Thursday night.

    The Austin-based company makes analog-intensive, mixed-signal integrated circuits for the communications industry.

    Mixed-signal ICs convert analog signals, such as radio waves, into digital signals that can be processed by electronic products. They are used in cellular phones, cable and satellite set-top boxes, modems and fax machines.

    "This is probably one of the class acts of the week," said Irv DeGraw, research director at WorldFinanceNet.com.

    Silicon Labs is selling 2.72 million shares and shareholders are selling 480,000 additional shares, according to the company's prospectus filed with the U.S. Securities and Exchange Commission.