Expect the following technology stocks to be among Monday's most actively traded stocks: F5 Networks, Microsoft, Peapod and Sun Microsystems.
Keep an eye on F5 Monday after the company announced late Friday that it would release 2.5 million shares of common stock that had been to lock-up restrictions.
Hambrecht & Quist, lead underwriter for F5's IPO in June, agreed to the move, F5 said.
The shares originally weren't scheduled for lock-up release until Dec. 2, but the company wants to increase its public float and reduce some of the stock's volatility, an F5 spokesman said. "We're trying to stabilize the stock," the spokesman said. "It's been performing well, so H&Q didn't have any problems with a partial release."
Since going public June 4, F5's share price has multiplied more than a dozen times. Much of that gain has come in the last few weeks, as F5 screamed higher from around 80 in mid-October to as high as 145 3/16. F5 closed off 6 3/16 to 138 1/2 Friday.
Okay, it's obvious. But it should be interesting to see just how much panic or lack thereof sets in Monday after a federal judge ruled it holds a monopoly in PC operating systems and used that power to stifle innovation and steam roll potential competitors.
Its shares fell 2 9/16 to 89 in after-hours trading Friday.
Although the ruling, called a "finding of fact," was not a verdict, some pundits are already hailing the decision as a precursor to any number of remedies including the possible breakup of the software giant.
"Microsoft enjoys so much power in the market for Intel-compatible PC operating systems that if it wished to exercise this power solely in terms of price, it could charge a price for Windows substantially above that which could be charged in a competitive market," Jackson wrote in his decision.
J.P. Morgan analyst Bill Epifanio told Reuters that he'd already calculated Microsoft shares have underperformed the rest of the Nasdaq 100 by about 9 percent in the past month as investors have braced for the ruling.
Rick Sherlund, an analyst for Goldman Sachs, said the ruling was an ``ominous'' turn of events that will darken the cloud of uncertainty over the company, leading to renewed speculation about its fate at least until Jackson's final decision and order, expected in February or March.
``It was very clearly a rout against Microsoft,'' he said. ''His language was harsh, and his conclusions were one-sided.''
Investors who can tolerate that risk might elect to buy Microsoft when the stock dips, reasoning that any court-imposed remedy, no matter how harmful to the company's competitive position, will be postponed until after all appeals are exhausted, which easily could be 2001.
Peapod shares fell 3 5/16, or 22 percent, to 11 11/16 during regular trading Friday and then plunged another 3 1/8 in after-hours trading after saying its "existing cash and marketable securities may be insufficient" to fund its operations for the next year.
The startling admission was buried in the company's 10-Q filing with the Securities and Exchange Commission.
In the report, Peapod officials said it's evaluating financing opportunities but admits that there "can be no assurance that capital will be available to the company on favorable terms, or at all."
This latest blow comes just days after Peapod missed analysts' estimates by 10 cents a share in its latest quarter, losing $6.5 million, or 38 cents a share, on sales of $16.5 million.
Operating expenses in the quarter rose 44 percent from the previous quarter, with general and administrative costs nearly tripling as Peapod recorded one-time costs related to hiring new management. Including $2.9 million, or 15 cents per share, in non-recurring revenue, Peapod lost $9.4 million, or 53 cents per share.
The third quarter sales of $16.5 million represent a 3.5 percent decline from $17.1 million in the second quarter.
Peapod shares moved up to a 52-week high of 15 11/16 ahead of the earnings report after falling to a low of 3 1/2 last November.
Three of the six analysts following the stock maintain a "hold" recommendation.
You could pick Sun or America Online Inc. (NYSE: AOL) or Oracle Corp. (Nasdaq: ORCL) or any of Microsoft's many bitter competitors.
It says here Sun Microsystems will feel the most significant early impact of the Microsoft ruling, primarily because it has so much momentum rolling right now.
On Friday, its shares closed up 2 1/8 to 109 11/16, just a tick or two away from a 52-week high.
This stock was trading at 29 3/4 last November.
Twenty-one of the 24 analysts following the stock maintain either a "buy" or "strong buy" recommendation.