WebMethods Inc. (Nasdaq: WEBM) sank 8 percent Wednesday following a fourth quarter report that beat estimates and showed strong revenue growth.
Shares in the XML-based business-to-business software company were down 7 11/16 to 106 1/16, well below its 52-week high of 336 1/4. The stock shot up over 500 percent in its IPO last February.
After building the stock up Monday and Tuesday in expectation of a strong report, investors decided to sell on the good news. Stephen Sigmond, analyst with Dain Rauscher Wessels, said the quarter was strong.
WebMethods said revenue increased 360 percent to $10.4 million, compared to $2.3 million in the 1999 fourth quarter. The net loss for the fourth quarter, excluding amortization of deferred stock compensation, was $6.3 million, or 21 cents a share, which beat the First Call Corp. consensus estimate of a loss of 27 cents a share.
"I was pleased with the quarter," said Sigmond. "WebMethods validated its position and was well ahead of our revenue projections." Sigmond estimated revenue of $6.1 million.
For the fiscal year ended March 31, total revenue increased 416 percent to $23 million, compared to $4.5 million for 1999. Net loss, excluding amortization of deferred stock compensation, was $16.4 million or 62 cents a share.
WebMethods competes with OpenMarkets (Nasdaq: OMKT), InterWorld (Nasdaq: INTW) and ConnectInc.com, a subsidiary of Calico Commerce (Nasdaq: CLIC).