Shares of Cambridge Technology Partners Inc. (Nasdaq: CATP) plunged 1 9/16, or 11 percent, to 12 11/16 even though its third-quarter earnings topped Street estimates by 4 cents a share. However, it also said its fourth-quarter earnings will fall short of estimates.
In the quarter, Cambridge earned $10.7 million, or 18 cents a share, on sales of $168 million.
First Call consensus expected the computer services provider to earn 14 cents a share in the quarter.
The company said it expects its fourth-quarter earnings to be at least 45 cents lower than analysts' consensus estimate of 16 cents per share, as compiled by First Call.
Cambridge said the expected shortfall in the fourth quarter would reflect a pre-tax charge of $12 million to $17 million for an additional 50 percent employee bonus program. Bonuses will be increased to 100 percent of targeted levels and the extra amount will be performance-based, it said
In the third quarter, Cambridge officials said demand for e-commerce services rose 41 percent in the third quarter, compared to the same period last year. Sequential revenue growth from the second quarter of 1999 increased by 3 percent, due mostly to increased global demand for the company's e-commerce services.
Its shares rallied up to a 52-week high of 32 1/4 in February before falling to a low of 10 5/8 in March.
Twelve of the 19 analysts following the stock maintain a "hold" recommendation.