From Briefing.com: 12:49PM Nasdaq Composite edges to minor new high (COMPX) 2117 +6.70: -- Update -- -- Technical -- The rebound off the morning low has been extended with the index edging to a new high for the move. Currently vacillating near weekly congestive resistance at 2115/2117 with the next barriers of interest at 2127 (200 wk simple mov avg) and the 2135 area.
12:30PM RIMM target raised to $100 at ThinkEquity 80.83 +1.62: ThinkEquity maintains their Strong Buy rating and raises their target to $100 from $70 after the co completed its 10.5 mln share offering. In addition, firm believes RIMM continues to see strong demand across the board for its voice-enabled Blackberry devices, and said RIMM is expected to release its new Chinese language Blackberry in 1H04, which they believe will spark a strong demand surge in a completely new mkt.
12:18PM Notable Mentions : Cree Inc (CREE 20.78 +0.20): ThinkEquity expects CREE to post positive results tonight after the close, with the possibility of better-than-pre-announced upside as strength in handsets drives growth... AT&T Wireless (AWE 9.65 -0.34): With multiple fumbles in Q4, SG Cowen expects AWE to report miserable operating results. SG Cowen's Wireless Retailer Survey, prompts firm to cut gross adds by 102K to 2.12MM; firm cuts net adds to 100K from 240K... Genentech (DNA 91.85 +1.18): Price target raised to $107 from $95 at Thomas Weisel... j2 Global (JCOM 27.54 +0.05): First Albany believes that long-expected launch of fax2mail service by Ptek Holdings this morning is fully reflected in the share price.
11:52AM Hewlett-Packard announces more than $2.5 bln in Linux-based revenues in 2003 (HPQ) 25.45 +0.75: Co announces record-setting Linux-based revenue in excess of $2.5 bln for its fiscal year 2003 as well as additions to its Linux portfolio, including industry-standard desktop PCs and notebooks running Linux.
11:42AM Volume Alert -- Broadcom makes new session highs amid a surge in volume (BRCM) 41.50 +0.81: Stock has spiked about $0.60 over the past six minutes.
11:40AM Nasdaq Composite edges off low (COMPX) 2096 -14.8: -- Technical -- The index has been on the defensive throughout the session with initial supports taken out. However, the bottom of the now week long trading range (2080/2077) was not tested (session low 2088) with the index currently attempting to recover. Intraday resistances are at 2097 (20 exp avg -- hourly chart) and 2106/2108 in front of yesterday's high (2111) and the high for the move (2114).
11:15AM More derivative calls on Intel earnings : American Technology Research says that Intel reported record unit shipments of microprocessors in desktops, mobiles, and servers last night, and unit demand is expected to continue through 2004; firm says this increases their confidence in 2004 ests for SANM and SLR, the two EMS names with the most Intel exposure. They also believe that strength in unit shipments has positive implications for the passive component makers, AVX, KEM, and VSH, since every Intel motherboard sold requires roughly 600 passive components and every notebook computer sold requires roughly 1,500; firm maintains that unit demand for passive components continues to increase and that pricing continues to firm, driving gross margin improvement and earnings power. In addition, firm says another positive derivative call is on OIIM, which has 75% exposure to notebook PCs (Intel reported 30% YoY unit growth in mobile processors).
10:40AM SANM: IBM results bode well for Sanmina-SCI -- Kaufman 13.35 -0.34: Kaufman Bros believes that IBM's strong Q4 hardware results and Intel's healthy Q4 call last night point to a robust quarter for Sanmina-SCI (SANM) as the EMS provider is actively involved in the computing market (60% of sales); notes that Sanmina-SCI generated 40% of total revs from the PC market (which includes Intel-based servers) in Q4 and 20% from enterprise computing/storage programs.
10:37AM New High Profile -- Midway Games (MWY) 4.31 +0.11: Making a new high today is Midway Games, a developer of gaming software for PS2, Xbox, and Nintendo, known for the seminal Pong and Mortal Kombat games. Many video game makers have been weak lately after a lackluster holiday season. However, Midway has quietly climbed 60% since mid-Nov. Driving the stock higher has been news that Viacom CEO Sumner Redstone is interested in the stock. Antitrust commissioners recently lifted restrictions this week on his plans to snap up more shares. Redstone is hoping to raise his holdings to between $50-$100 mln, according to an SEC filing. Also propelling the stock is its high short interest at about 25% of the float. Mkt cap $245 mln; float 37.2 mln; avg volume 469K.
10:17AM QLGC upped to Outperform from Peer Perform at TWP; tgt $55 47.16 -3.20:
10:14AM QLGC: Hearing Thomas Weisel upgrading stock from Peer Perform; no confirmation 46.80 -3.56:
10:13AM FLEX: Hearing Siemens has ended a contract with Flextronics 16.32 -0.19: Hearing European consumer electronics giant Siemens has ended a contract with Flextronics. According to an article posted on Danish TV2 homepage 700 workers will be laid off.
10:05AM Agilysys guides Q3 and Y04 above consensus (AGYS) 12.21 +0.16: As a result of strong Q3 performance, the Co anticipates that earnings will be between $0.26-0.28 per share, well above Reuters consensus of $0.18 and current First Call estimate of $0.20. Co now estimates that Y04 will be between $0.22-0.24 per share (previous guidance was $0.16-0.20), Reuters consensus is $0.16.
10:04AM JPM/ONE merger implications for payment processors : Merrill Lynch believes that the JPM acquisition of ONE has mixed implications for payment processors First Data (FDC) and Total System Services (TSS), and should not have any impact on CheckFree (CKFR). Firm does not (at least initially) see any negative impact on FDC's merchant processing operations from the merger, but says it complicates FDC's PIN-based debit network relationships. Regarding card issuance, since FDC has a broad relationship with JPM covering both merchant and card issuance processing, firm thinks JPM may want to leave ONE's card processing at FDC, and thinks it is less likely that JPM could choose to enhance its relationship with TSS. Also, since both banks have recently moved their online bill payment operations away from CKFR, they see no impact on that co. On the other hand, Lehman says that since it appears that ONE mgmt will take charge of the combined card processing biz, they believe that ONE mgmt's argument to use TSS's platform on a licensed basis will be even stronger and the co is positioned to land the combined program.
9:59AM IBM pulls back from longer term resistance (IBM) 94.81 +4.50: -- Update -- -- Technical -- The early run in IBM, in reaction to its earnings report, left it just shy of a longer term resistance in the 95.76/97.79 area (session high 95.65). This marks its Jan 2002 low as well as its 200 wk simple mov avg. For the near term, if able maintain a posture above its Oct (94.54) and Dec (94.12) highs and sustain a breach of the longer term resistance, the door would be open back to the top of the 2002 gap at 97.25.
9:45AM ASML tgt raised to $30 from $20 at CIBC 21.00 -0.79: CIBC raises its ASM Lithography (ASML) tgt to $30 ahead of Q1 conference call at 10:30AM; firm says results ahead of estimate providing solid evidence of accelerating visibility and heightened confidence in firm's Street high 2004 estimate. At a 29x p/e, believes shares are undervalued relative to the peer group and historical multiples, providing best-in-class opportunity for multiple expansion. New price target discounts what is to firm a reasonable 35X P/E of 2004E earnings, plus cash, or $30.
9:37AM ADSK estimates raised at TWP : Thomas Weisel raises estimates on Autodesk (ADSK 25.04 -0.05) as channel and customer checks indicate a strong pick up in Activity Levels; raises JanQ est to $0.29 from $0.27, AprQ to $0.12 from $0.10 and FY05 to $0.97 from $0.90. The firm's checks with ADSK resellers indicate that activity levels have improved meaningfully over the last 6 months and checks on the quarter have been very positive. Also, the co has announced its next upgrade of AutoCAD will be coming at the end of March. Historically, the stock has tended to trade up during the 4 months prior to an upgrade.
9:13AM TMTA: Intel pushout could be big event for Transmeta -- SoundView 3.87: SoundView comments that Intel two quarter pushout of Centrino 90nm (Dothan) could be a very big event for Transmeta (TMTA). Firm believes that Transmeta should gain major credibility for effectively outlining the problematic nature of low power chip design using advanced process nodes such as 90nm.
9:03AM Notable Mentions : Veritas (VRTS): RBC raising its DecQ estimates on Veritas to reflect firm's expectation of robust upside results relative firm's original guidance. RBC's Q4 est goes to $0.25 from $0.23 (Reuters consensus $0.24); firm's 12-month tgt goes to $39... Sandisk (SNDK): Following Samsung's 4Q03 results (released last night) and commentary regarding 2004, Thomas Weisel remains comfortable in its positive stance on shares of Sandisk; notes that Samsung suggested that undersupply may persist until 2H04.... Radioshack (RSH): Thomas Weisel says that while co announced Q4 would exceed the upper end of EPS guidance, sales of $1.48 bln fell short of firm's $1.52 bln est. While firm pleased with RSH's strong wireless performance, gross margin improvement, supply chain savings and resulting EPS upside, Thomas Weisel is concerned by the weak sales performance throughout the remaining business segments.
8:51AM IBM says 2004 EPS reasonable on conf call (IBM) 90.31: On its confercence call, co says consensus 2004 EPS is reasonable, but 2004 revenue growth could be a point or so higher; co also says the IT industry will begin its next growth cycle in 2004.
8:39AM YHOO downgrade details 48.39: Smith Barney downgrades Yahoo! (YHOO) to Hold from Buy based on valuation; valuing the Yahoo!-branded cash flows at 35x (in-line with Amazon and eBay) and the less predictable third-party derived cash flows at 10-15x, and then adding in $3.1 bln in projected net cash and a $7.2-$7.5 bln value for Yahoo!'s equity stake in Yahoo! Japan, firm arrives at a target enterprise value of $34-$35 bln for Yahoo! overall, or about $50/ share.
8:06AM PLNR downgraded at CIBC 18.30: CIBC downgrades Planar Systems (PLNR) to Underperform from Sector Perform; firm expects the stock to see further near-term weakness due to a lack of specifics from mgmt on the Q1 conference call regarding visibility in its core medical biz; while the co's commercial segment continues to surpass expectations, firm says the lost share in the high-margin medical segment requires implementing new marketing strategies, for which near-term success is uncertain in the face aggressive Asian competition.
8:03AM SNDK sell-off yesterday a buying opportunity -- WR Hambrecht 65.25: WR Hambrecht reiterates its Buy and $105 price target on SanDisk (SNDK) as the firm views yesterday's sell-off (-6%) as the perfect opportunity to buy the stock ahead of its quarterly report. Samsung's positive commentary bodes very well for SanDisk as the co is poised to increase its flash card market share, as well as enjoy the fruits of the cell phone market with SD/mini-SD/MS Duo/RS MMC. The firm expects SanDisk will post Q4 upside and may experience less seasonality than its peers in Q1. Samsung sees '04 NAND flash bit growth of 180-200%, which supports the firm's opinion that the industry continues to accelerate, which bodes well for SanDisk.
8:03AM Extreme Networks earnings update (EXTR) 8.95: -- Update -- Reuters Research is indicating that, excluding the $1 mln charge, EXTR lost $0.04 per share, which compares to their consensus of a loss of $0.03 per share.
7:53AM ASML orders disappoint despite return to profit -- Reuters 21.79: Reuters reports that Dutch chip equipment maker ASML disappointed markets with slower than expected growth in its order book, despite soundly beating expectations on Thursday with a strong return to profit. The world's largest maker of lithography machines, also said its chief executive Doug Dunn would retire later this year, and that it was looking for a successor.
7:44AM Mercury Computer beats by $0.02, guides Q3 & Y04 above consensus (MRCY) 26.96: Reports Q2 (Dec) earnings of $0.17 per share, $0.02 better than the Reuters Research consensus of $0.15; revenues fell 14.9% year/year to $40.6 mln vs the $41.0 mln consensus. Co also guides, sees Q3 EPS of $0.26-0.30, vs the R.R. consensus of $0.25, and revenues of $45-48 mln, vs an estimate of $48 mln; sees Y04 EPS of $1.00-1.05, vs the R.R. consensus of $0.86, and revenues of $180-185 mln vs an estimate of $180 mln.
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