Path: bloom-picayune.mit.edu!snorkelwacker.mit.edu!americast.com!americast.com!americast-post Newsgroups: americast.ibd From: americast-post@AmeriCast.Com Organization: American Cybercasting Approved: americast-post@AmeriCast.com Subject: NASDAQ Amex Market Date: Wed, 28 Oct 92 13:12:52 EST Message-ID: <8.1992Oct28.131253@AmeriCast.com> 10/28/92 TITLE NASDAQ Amex Market Nasdaq Mixed As 202 Million Shares Trade Softwares Fall To Profit-Taking; HMOs Still Under Pressure Lance Ignon A technology meltdown and continued weakness among health maintenance organization stocks left the Nasdaq market narrowly mixed yesterday. Techs had been on the rebound and may have gotten a little rich, said Alfred Goldman, director of market analysis for A.G. Edwards & Sons Inc. in St. Louis. "It looks like normal profit-taking to me," he said. "There's no news to account for it." Indeed, with the gross domestic product up an unexpectedly strong 2.7% for the third quarter, Goldman said cyclically sensitive tech stocks should have a brighter future. But with NYSE International Business Machines Corp. falling another 13/4 to 653/4 yesterday, investors may have developed cold feet for the industry, Goldman speculated. The Nasdaq com- posite index lost 1.97 points, or 0.33% to 596.95. But advances edged declines 1,206 to 1,200. Volume rose 20% to 203 million shares, outpacing Big Board trading by about one million shares. The New York Stock Exchange composite index gained 0.10%, and the American Stock Exchange market value index rose 0.13% as losers led 264 to 226. Powerful software developers took it on the chin. Microsoft Corp. lost 2 to 88, BMC Software Inc. 2 to 563/4, Informix Corp. 11/2 to 261/4, Sybase Inc.- 11/2 to 381/2, Progress Software Corp. 13/8 to 53 and Parametric Technology Corp. 11/4 to 493/8. But Marcam Corp., which fell 25/8 Monday, rebounded 27/8 to 25. The company calmed investors by announcing that its acquisition of rights to a software pro- duct from IBM will not dilute its 1993 earnings. It's expected to earn $1.25 a share for fiscal 1993 ending next August, up 25% from what analysts are looking for this year. Alex. Brown & Sons Inc. upped its rating to strong buy from buy. In the networking sector, Xircom Inc. plunged 37/8 to 91/8 as 1.1 million shares traded, 15 times average. The company reported a fiscal fourth- quarter profit of 11 cents a share, up 38% from a year earlier. Its full-year earnings accelerated 116% to 41 cents a share. But the Calabasas, Calif., firm added that it expected its growth rate to slow in the near term. Hambrecht & Quist Inc. cut its fiscal 1993 estimate to 55 cents a share from 63 cents. Also, Wellfleet Communications Inc. fell 11/4 to 481/2, Cisco Systems Corp.- a point to 581/2 and Novell Inc. 1 to 301/2. In the medical sector, HMO stocks took another pounding a day after industry bellwether U.S. Healthcare Corp.'s third-quarter results showed expenses rising and profit margins shrinking. U.S. Healthcare, down 63/8 Monday, fell another 21/4 to 411/8 and was the session's most active issue with 6.7 million trading. Oxford Health Plans Corp. dropped 21/8 to 393/4, Healthsource Inc. 21/4 to 371/2, TakeCare Inc. 13/4 to 443/4 and Ramsay HMO Inc. 11/4 to 293/4. Among Amex issues, Sierra Health Services Inc. lost 11/4 to 335/8. Biotechnology concern Genzyme Corp. rose 11/4 to 43 as investors anticipated an upbeat earnings report. After the close, the company reported a third-quarter profit of 38 cents a share, up 73% from the 22 cents of a year ago. Retailers generally were weaker. Staples Inc. sank 11/8 to 351/2. The chain of office sup- ply stores launched a $100 million offering of 5% convertible subordinated bonds, due 1999. Proceeds are earmarked for new stores and international joint ventures. Costco Wholesale Corp., off as much as 15/8, closed at 29, down 5/8. For the fourth quar- ter ended Aug. 30, the Kirkland, Wash.-based firm reported a pro- fit of 32 cents a share, 19% above a year ago and a penny better than the mean expectation, according to Zacks Investment Research Inc. Costco earned 93 cents for the year, a 24% improvement from fiscal 1991. "We were extremely pleased with the quarter," said Montgomery Securities Inc. analyst Bo Cheadle. "But I think a lot of people were confused." Cheadle said investors were unnerved by the company's announcement that sales from stores open at least a year had slipped to 6% so far in the fiscal-first quarter. They were up 8% in September alone. But Cheadle said these same-store sales gains will end up totaling 8% by the time the quarter end in November as newer stores become eligible for this category. The analyst noted that 10 stores will be added to the same-store category between the third week of this month and early December. Newcomer Starbucks Corp.- slipped 21/4 to 291/2. The Seattle-based chain of coffee stores came public last June at $17 a share. A company spokeswoman said there was "no fundamental reason for the stock to be down." On the upside, better-than-expected earnings drove Buffets Inc. up 23/4 to 29. More than two million shares traded, seven times usu- al. The Eden Prairie, Minn.-based restaurant chain checked in with a third-quarter profit of 28 cents a share - 40% better than a year ago and three cents above expectations. Back Bay Restau- rant Inc. recouped a point to 131/2. It fell 2 on Monday on con- cern over an internal investigation and a major management shake-up. By yesterday, however, investors were focusing on the previous day's earnings report, which showed third-quarter pro- fits up 80% to 18 cents a share. Among banking stocks, Washing- ton Mutual Savings Bank of Seattle shot up 35/8 to 29 after it announced plans to buy Pacific First Financial Corp., a subsidi- ary of Royal Trustco Ltd. of Toronto. Nearly 1.6 million shares, 11 times average. Eagle Bancshares Inc. of Tucker, Ga., gained a point to 13. Citing lower interest rates and higher-fee income, the savings and loan reported a 356% increase in fiscal second- quarter profit to 73 cents a share. Eagle's profits have ac- celerated consistently for the more than two years. An in-line earnings report helped Spartan Motors Inc. rise 11/4 to 163/4. The Charlotte, Mich.-based maker of heavy-duty truck chassis posted a third-quarter profit of 30 cents a share, up 7% from a year earlier. The increase is a far cry from the pace of last year, when Spartan's profits rose an average of nearly 150% every quarter. As a result of the slowdown, the stock now trades at about half of what it fetched at its peak last February. Re- flecting renewed hope for an economic recovery and therefore an upturn in cyclical issues, paper company Willamette Industries Inc. climbed 21/2 to 35 and chemical maker Sigma Aldrich Corp. 11/2 to 523/4. This article is copyright 1992 Investors Business Daily. Redis- tribution to other sites is not permitted except by arrangement with American Cybercasting Corporation. For more information, send-email to usa@AmeriCast.COM