eBay Cools Off

eBay , the Internet’s enduring success story, may finally be showing signs of cooling off.

eBay fell more than 5% after hours Thursday after the company guided 2004 estimates lower, an almost unprecedented warning from the company.

eBay matched third-quarter earnings estimates of 18 cents a share, beat revenue estimates by $12 million with $530.9 million sales, and reaffirmed fourth-quarter estimates of 21 cents a share.

But eBay said it sees 2004 earnings as high as 98 cents a share – well under 1.05 estimates. That’s still strong growth from this year’s estimated earnings of 74 cents a share, but analysts have long been accustomed to seeing the online auction king top their estimates.

Analysts at Salomon Smith Barney had issued a rare Sell rating on eBay Monday on concern about slowing sales at eBay Motors.

eBay’s stock has been a stellar performer even as the rest of the Internet sector came crashing back to earth, and recently came within 2 points of its all-time high (63.75) set in March 2000.

Also after the close, Sun showed no signs of reversing its troubles as the company missed revenue estimates. AMD , Broadcom , PMC-Sierra , Fairchild , Avid , and WebEx beat estimates. Rambus met estimates, Xilinx missed revenue estimates, and DoubleClick and RSA warned.

Stocks finished the day mixed – an almost amazing accomplishment considering disappointing earnings from Dow heavyweights IBM , which fell 4%, and Caterpillar , which lost 6%. A much better than expected Philly Fed report helped.

The Nasdaq rose 11 to 1950, the S&P 500 added 3 to 1050, and the Dow lost 11 to 9791. Volume declined to 1.38 billion shares on the NYSE, and 1.77 billion on the Nasdaq. Advancers led 19-13 on the NYSE, and 18-13 on the Nasdaq. Upside volume was 62% on the NYSE, and 61% on the Nasdaq. New highs-new lows were 297-9 on the NYSE, and 267-5 on the Nasdaq.

Solid earnings reports by a number of leading names were met with selling. Nokia , SAP , Apple and E*Trade were among those trading lower despite beating estimates.

Netflix soared after beating estimates, and QLogic , EMC and Nextel rose on better than expected results.

Redback , Siebel and Transmeta fell on disappointing results.

For more on EMC’s and Siebel’s results, see EMC Tops 3Q Expectations and Siebel Acquires Two In CRM Push.

VeriSign rose 4.5% after selling its domain name registration business.

Advanced Fibre soared 11% on rumors of a major contract win.

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