STOCKS TO WATCH: Apple, Intel, Motorola and PairGain

Analysts and investors alike are convinced the PC maker will top analysts' estimates when it announces its third-quarter results Wednesday.

First Call consensus expects it to earn 64 cents a share.

If the past four quarters are any indication, there's good reason to believe Apple will beat that mark. Sales in Japan and throughout North America should help Apple improve on both its revenue and gross profit margins this quarter.

Apple shares closed off 13/16 to 53 11/16.

Last quarter, it made $93 million, or 60 cents a share, on sales of $1.53 billion.

The networking-products company said net income was 11 cents a share for the second quarter, beating First Call estiamtes of 8 cents a share, and a loss of 29 cents for the same period a year earlier.

Digital Link fell 7/8 to 10 1/4 at Tuesday's close.

It's unusual for Intel to miss analysts' estimates as it did Tuesday in its second quarter. But it's even more unusual for stoic Intel to predict stronger-than-expected results as it did for the third quarter.

This quarter, it made $1.75 billion, or 51 cents a share, on sales of $6.75 billion.

First Call consensus expected it to earn 53 cents a share in the quarter.

However, third quarter revenues will be up slightly from the second, the company said. Better cost controls and more efficient manufacturing will lead to better margins that previously expected, Intel said.

The company now expects gross margins of 60 percent for the year, up from a previous estimate of 57 percent.

Intel shares closed off 1/16 to 65 3/8 Tuesday.

In after-hours trading, Intel shares were up 7/8 despite the earnings shortfall.

The online women's network said Tuesday it would buy Lamaze Publishing Company, a privately held, leading multi-media organization providing educational information to the expectant and new mother parenting sector.

Lamaze Publishing is also the exclusive marketing agent of Lamaze International, a not-for-profit organization, headquartered in Washington, D.C.

iVillage shares closed off 3 11/16 to 52 ? Tuesday.

Motorola easily topped analysts' estimates in its second quarter Tuesday, raking in $273 million, or 44 cents a share, on sales of $7.5 billion.

First Call consensus pegged Motorola for a profit of 41 cents a share in the quarter.

The $7.5 billion in sales represents a 7 percent improvement versus the year-ago quarter when it made only $6 million, or 1 cent a share, on sales of $7 billion.

Company officials credited strong growth in the semiconductor sales as well as a recovery in Asian markets.

This marks the second quarter in a row that Motorola has delivered an upside surprise.

Last quarter, it earned $171 million, or 28 cents a share, on sales of $7.2 billion.

First Call consensus expects Motorola to earn $2 a share in the fiscal year.

The stock peaked at 100 3/16 earlier this month after trading at a 52-week low of 28 2/8 in October.

Twenty-six of the 26 analysts following the stock maintain either a "buy" or "strong buy" recommendation.

PairGain missed analysts' estimates for the second consecutive Tuesday, earning $3.5 million, or 5 cents a share, on sales of $61.2 million.

First Call consensus expected the Tustin, Calif.-based maker of digital subscriber line products to earn 6 cents a share in the quarter.

Again, pricing pressure was the culprit.

Gross profit margins fell to 41.4 percent in the quarter, down from 50.8 percent in the year-ago quarter when it earned $11.8 million, or 16 cents a share, on sales of $73.4 million.

PairGain shares closed off 11/16 to 11 9/16 ahead of the earnings report.

Including a $1.5 million second quarter write-off of a long-term investment and a $1.5 million charge for the settlement of litigation between the company and Harris Corp., PairGain earned only $1.1 million, or 1 cent a share, in the quarter.

Its shares raced up to a 52-week high of 17 3/8 last July before swooning to a low of 6 in October.

Ten of the 18 analysts following the stock maintain either a "buy" or "strong buy" recommendation.

The cable-modem seller reported a loss of 17 cents a share for the second quarter, narrower than the 22-cent average estimate of six analysts surveyed by First Call. The company also announced it agreed to buy Imedia Corp., a maker of routing systems for digital video, for $100 million in stock. The acquisition will give Terayon a complete broadband system to support high-speed cable delivery.

Terayon shares rose 1/2 to 48 1/2.