STOCKS TO WATCH: Cabletron, Deltek Systems, ION Networks and Palm

Cabletron Systems will be on the move Thursday after it posted a smaller-than-expected loss in its first quarter, losing $3.7 million, or 2 cents a share, on sales of $275.1 million.

First Call Corp. consensus expected the network-equipment maker to lose 3 cents a share in the quarter.

Its shares closed up 5/8 to 22 1/2.

The $275.1 million in sales marks a 28 percent decline from the year-ago quarter when it earned $28.1 million, or 15 cents a share, on sales of $381.8 million.

Including other income and all charges, Cabletron's actual net loss for the quarter was $37.9 million, or 21 cents a share.

Deltek shares should tumble Thursday after it warned that its second-quarter sales and earnings will fall woefully short of analysts' estimates.

Its shares closed up 3/16 to 8 13/16 ahead of the profit warning.

Company officials said it will likely post a profit of between 5 cents to 9 cents a share, well below the First Call Corp. consensus estimate of 24 cents a share.

It says it now expects sales in the vicinity of $23 million, slightly lower than the $23.8 million it recorded in the year-ago quarter.

Deltek cited three primary reasons for the shortfall, including an overall slowdown in software sales and consulting revenues, increased software development and sales and marketing costs, and a significant increase in accounts receivable reserve, which is expected to be nonrecurring.

ION Networks will be in the same boat Thursday after it said it will miss analysts' sales and earnings estimates in its first quarter.

Ahead of the profit warning, its closed unchanged at 4 3/16.

Company officials now say it will post sales of around $2 million in the quarter, down from $4.9 million in the year-ago quarter.

"While we are still in the process of finalizing our revenues for the first quarter, our preliminary review shows that our revenues will be significantly lower than anticipated," said CEO Stephen Gray in a prepared release.

ION Networks, which makes a variety of Internet security software and hardware, also announced that it would restructure its worldwide sales team with Gray serving as the interim leader.

Last quarter, ION Networks disappointed investors when it posted a loss of $2.7 million, or 19 cents a share, on sales of $5.7 million.

Palm should be on the rise Thursday after it topped analysts' estimates in its fourth quarter, pocketing $16.9 million, or 3 cents a share, on sales of $350.2 million.

First Call Corp. consensus expected the maker of handheld computing devices to earn 1 cent a share in the quarter.

The $350.2 million in sales represents a 101 percent improvement from the year-ago quarter when it made $6.8 million, or 1 cent a share, on sales of $174.3 million.

Last quarter, Palm posted a profit of $15.5 million, or 3 cents a share, on sales of $277.3 million.

Palm said it delivered more than 1.1 million devices in the quarter and had inventory turns of 32 and days sales outstanding of 31. The company also highlighted a host of moves designed to develop new revenue streams.

Palm also recently announced deals to develop mobile portals, instant messaging and add-on cards to boost functionality. Meanwhile, the company is licensing its operating system to other companies.

Its shares closed off 1/2 to 26 3/8 Wednesday.