RealTime IT News

AMAT Dampens Investor Enthusiasm

Applied Materials didn't give investors much reason to hope for an imminent rebound in technology spending.

In the company's earnings and conference call Tuesday night, AMAT predicted flat revenues, orders and earnings, all less than analysts were looking for. The stock declined 3.8% in trading Wednesday.

The company has recognized some savings from cost-cutting, but overall the semiconductor equipment giant gave analysts the impression that 2003 may be another lackluster year.

Longer term, AMAT says it sees flat panel displays as the technology that will lead the chip sector out of its slump and drive a revolution in portable devices. But at 104 times earnings and 5 times sales, investors had priced AMAT stock for better results now.

The broad market slipped Wednesday on weaker than expected retail sales and caution ahead of weekly jobless claims and inflation numbers on Thursday and Friday.

The Nasdaq slipped 4 to 1534, the S&P 500 declined 3 to 939, and the Dow fell 31 to 8647. Volume slipped to 1.38 billion shares on the NYSE, and 1.81 billion on the Nasdaq. Decliners led 16-15 on the NYSE, while advancers led 16-15 on the Nasdaq. Upside volume was 52% on the NYSE, and 51% on the Nasdaq. New highs-new lows were 215-5 on the NYSE, and 205-7 on the Nasdaq.

After the close, Computer Associates , Intuit and Analog Devices beat estimates and raised guidance. Brocade and BEA matched estimates.

During the day, J2 Global Communications rocketed 22% on a pact with Microsoft .

Computer Sciences surged 10% on better than expected results.

Applied Materials and Network Appliance sagged on lukewarm results, and Sycamore fell 4.6% on its results.

Gateway fell 3% on news of a criminal investigation.

IBM slipped 1.2%, giving up yesterday's breakout to a new 52-week high, after announcing an on-demand acquisition. At least volume declined on the pullback.

Symantec , off 1.6%, also announced an acquisition.

Verizon tacked on a nickel as it began a DSL advertising push.

Cisco slipped 6 cents as the company named a new CFO.

Juniper rose 4% to a new 52-week high on an upgrade.

Dell lost 1% ahead of earnings tomorrow night.

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