THE DAY AHEAD: Stocks to Watch

3 min read

Expect the following technology stocks to be among Friday's most actively traded issues: Adobe Systems, BMC Software, Cotelligent and a whole basket full of Internet IPOs.

  • Adobe Systems Inc. (Nasdaq: ADBE)

    Adobe should be on the rise Friday after it topped Street estimates by a nickel a share in its second quarter. The software developer made $45 million, or 70 cents a share, on sales of $245.9 million.

    First Call consensus expected it to earn 65 cents a share in the quarter.

    Adobe shares closed off 1/8 to 73 3/8 ahead of the earnings report but quickly shot up 2 1/8 in after-market trading.

    The $45 million profit represents a 61 percent improvement versus the year-ago quarter when it made $28 million, or 41 cents a share, on sales of $227.3 million.

    Last quarter, Adobe shattered analysts' estimates, earning $38.3 million, or 60 cents a share, on sales of $226.9 million.

    Earlier this quarter, company officials predicted strong results this quarter but also announced that it would trim 250 jobs, or roughly 9 percent of its workforce.

    First Call consensus expects Adobe to earn $2.72 a share in the fiscal year.

  • BMC Software Inc. (Nasdaq: BMCS)

    BMC said Thursday it will take a $16 million charge in its first quarter and layoff 275 employees as a result of several large acquisitions in the past year.

    Company officials said the layoffs and charges are a byproduct of integrating the acquisition of Boole & Babbage Inc. for $900 million and gobbling up New Dimensions Software Ltd. for $650 million.

    First Call consensus expected BMC to earn 40 cents a share in the first quarter.

    Last quarter, BMC easily hurdled analysts' estimates, raking in $115.7 million, or 47 cents a share, on sales of $386.5 million.

    Its shares motored up to a 52-week high of 60 ? in October before plummeting to a low of 30 in April.

    Twenty-five of the 27 analysts following the stock rate it either a "buy" or "strong buy."

    BMC is expected to earn $1.96 a share in the fiscal year.

  • Cotelligent Inc. (NYSE: CGZ)

    The San Francisco-based IT services company on Thursday warned it would report a fiscal first quarter loss ranging between $13 million and $15 million, including one-time events.

    In the first quarter of 1998, Cotelligent earned $1.8 million.

    First Call consensus was expecting a profit of 30 cents a share.

    Cotelligent, a provider of IT staffers for corporations, cited delays in corporate IT spending as enterprises -- especially financial services companies -- focus on eliminating Y2K-related computer problems. Revenue for the quarter ending June 30 will be more than $88 million, Cotelligent said.

    The company said it would take a first quarter charge of $4.2 million to pay for reorganizing its five practice group operating structure. It also plans to record a $20 million writedown of goodwill.

    Its shares closed off 1/4 to 8 1/2 ahead of the profit warning.

  • Internet IPOs

    There are quite of few of them but keep a close eye on Viant Inc. (Proposed ticker: VIAN), AppNet Systems Inc. (Proposed ticker: APNT) and GoTo.com Inc. (Proposed ticker: GOTO). Other IPOs include: Mail.com (Proposed ticker: MAIL) and Streamline.com Inc. (Proposed ticker: SLNE).

    AppNet and Viant are both e-commerce consultants. Both have moved up considerably from the original price range.

    GoTo.com functions like a search engine, but advertisers with the highest bid get the top results.