STOCKS TO WATCH: Red Hat, Riverstone, WebMD

Red Hat should be active after it topped analysts' estimates in its fourth quarter, posting a net loss of $600,000, or break even on a per share basis, on sales of $27 million.

First Call consensus pegged the seller of Linux software and services to lose a penny a share in the quarter on sales of $26.7 million.

Its shares closed unchanged at $5.22 ahead of the earnings report before moving up to $5.56 in after-hours trading.

The $27 million in sales represents a 106 percent improvement from the year-ago quarter when it lost $5.6 million, or 4 cents a share, on sales of $13.1 million.

For the fiscal year, Red Hat posted a net loss of $5.9 million, or 3 cents a share, on sales of $84 million, up 100 percent from fiscal 2000 when it lost $19 million, or 19 cents a share, on sales of $42 million.

The telecommunications-equipment maker beat the Street in its first quarter as a publicly traded company, posting a fourth-quarter loss of $5.5 million, or 6 cents a share, on sales of $35.1 million.

Its shares closed off 28 cents to $8.63 before inching up to $8.69 in after-hours trading.

Analysts expected Riverstone, a spin-off of Cabletron Systems (NYSE: CS), to lose 8 cents a share in the quarter.

In the year-ago quarter, it lost $6 million on sales of $12.8 million.

After peaking at $15.13 shortly after its initial public offering in February, the stock fell to a low of $6.69 earlier this month.

The online healthcare information provider will be worth watching Friday after it posted a smaller-than-expected loss in its fourth quarter.

In the quarter, it lost $51.8 million, or 14 cents a share, on sales of $199 million.

First Call consensus pegged it for a loss of 16 cents a share in the quarter.

In the year-ago quarter, WebMD lost $47.5 million, or 40 cents a share, on sales of $33.2 million.

The company absorbed a charge related to its restructuring and integration efforts of $408 million and $452.9 million for the quarter and year ended Dec. 31, 2000, respectively.

The stock finished off 30 cents to $5.83 ahead of the earnings report before moving up to $6.13 in after-hours trading.