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RealTime IT News

EDS Wows Wall Street

Shares of EDS rallied 9% after the close on Wednesday after the company said its 2006 earnings will exceed analysts' estimates by 50% or more.

EDS, which had already issued a positive earnings preannouncement last week, topped that performance after the bell on Wednesday when it said its 2006 pro forma earnings will be $1 a share or more, well above the 66 cents expected by analysts.

"EDS posted a solid second quarter that shows our transformation plan is on track and gaining momentum," CEO Mike Jordan said in a statement. "Our progress in bolstering productivity and improving the performance of our large outsourcing contracts, including the U.S. Navy Marine Corps Intranet, drove substantial earnings, margin and free cash flow improvement. We expect this trend to continue, delivering significant EPS and free cash flow improvement in the second half of 2005 and for full-year 2006."

Stocks were mixed during the day, as blue chips posted a small gain after oil prices declined.

The Nasdaq slipped 1 to 2216, the S&P climbed 8 to 1245, and the Dow gained 13 to 10,697. Volume declined to 2.02 billion shares on the NYSE, but rose to 1.83 billion on the Nasdaq. Decliners led 17-15 on the NYSE, and 17-12 on the Nasdaq. Downside volume was 51% on the NYSE, and 53% on the Nasdaq. New highs-new lows were 353-21 on the NYSE, and 161-17 on the Nasdaq.

NetEase soared 21% after blowing past estimates, and BMC and RealNetworks rallied more than 7% each on their results. iVillage rose 12% after reporting a break-even quarter.

Tech Data tumbled 9% after the company slashed its earnings forecast because of falling margins, but kept its sales guidance intact.

Overstock.com , ADI , Brocade , Borland , PlanetOut and UTStarcom fell on their results.

National Semi lost 3% on a Merrill Lynch valuation downgrade.