Apple Stock Watch - Apple Upgraded Again, Still Loses 59 Cents

by , 9:00 PM EDT, June 14th, 2001

Investors are finding time to worry about the June quarter as we get closer to its conclusion and the beginning of the earnings season. Trading volume continues to be light across the board as investors fret over the near-term future. The current sector to bear the wrath of this nervousness is apparently the software sector, helped in part by a price reduction from Oracle (see blow). From a CBS Marketwatch report:

"People are starting to get nervous about the June quarter," said John Ederer, analyst with Pacific Growth Equities. "It's been the elephant sitting in the room that no one's been willing to talk about. We went through a tough March quarter, and we saw a lot of pre-announcements, an now you're seeing anticipation that June will be difficult."

Apple was upgraded by Sanford Bernstein's Vadim Zlotnikov today. Mr. Zlotnikov cites Apple's strong notebook sales and strong PowerBook G4 sales as the catalyst to his upgraded earnings forecast. From TheStreet.com:

"Recent channel surveys indicate strong initial iBook sales and continued success of Power Book, consistent with overall strength in notebooks. Notebooks should drive 60% of Apple's sequential revenue growth," Zlotnikov wrote. As a result, the analyst took his third-quarter earnings target up to 17 cents a share and his 2001 estimate to a loss of 21 cents. The analyst didn't reveal his previous estimates. Sixteen analysts expect the company to make 15 cents a share in the third quarter and lose 23 cents for the full year, according to Thomson Financial/First Call.

On24 has a RealAudio report on this development as well. Apple moved lower by 59 cents in light volume.

Adobe announced its 2nd quarter earnings today in a press conference after the closing bell. The company beat Street estimates by a nickel a share, at 34 cents, excluding one time charges. The company said that Asian sales had been better than expected, while European sales were down. Sales for the quarter came in at US$339 million. From a Reuters report:

"Things were not as bad as people had been expecting. Period. I think overall people are going to be pleased with that," said Goldman Sachs analyst Jessica Kourakos. "From a relative perspective they are doing well."

Adobe warned that the current quarter would be flat compared to last year but expected growth in the 4th quarter.

C|Net has an interesting article about US companies that may begin to jointly develop wireless networks.

The Bush Administration has appointed, and the Senate has approved, Charles James as the next assistant attorney general in charge of the Justice Department's antitrust division. Charles James is known to be conservative in the area of antitrust law, and will be in charge of the government's antitrust lawsuit against Microsoft.

Oracle announced its newest product, 9i, which the company code-named "the last database" according to a Reuters report. The key feature of 9i is the ability to serve the database on a cluster, or many computers acting in tandem to create the kind of raw CPU power normally found in mainframes. Oracle has also lowered the price of 9i and analysts are saying it is in response gains that Microsoft and IBM are making in the high-end database market. Larry Ellison, Oracle's CEO, appeared on CNBC today to say that Oracle was still the strongest relational database vendor and that his company has gained market share in that market. In response to repeated questions about Oracle's current quarterly results, the CEO emphasized that Oracle would have been required to warn if they were anticipating missing current estimates, but he declined to say that his company actually would make those estimates. Mr. Ellison serves on Apple's Board, is a close friend of Apple's CEO, Steve Jobs, and is a fierce rival of Bill Gates and Microsoft.

Apple opened up lower and stayed in negative territory throughout the trading session. AAPL tried to stage a rally in late morning and in the last hour of trading, but was beaten back on both occasions. Volume was light and the stock closed 11 cents off the day's low. The day's range was 19.77 - 20.45.

Apple closed at 19.88, a loss of 0.59 (-2.88%), an light volume of 5,311,000 shares trading hands.

The Nasdaq closed at 2044.07, a loss of 77.59 (-3.66%), on volume of 1,764,858,000 shares trading hands.

The Dow closed at 10690.13, down 181.49 (-1.67%), on volume of 1,226,610,000 shares trading hands.

The S&P 500 closed at 1219.87, down 21.73 (-1.75%).

Adobe closed at 39.01, a loss of 1.17 (-2.91%), on strong volume of 5,942,300 shares trading hands.

Akamai's closed at 7.60, a loss of 0.93 (-10.90%), on light volume of 2,344,100 shares trading hands. Apple is a large shareholder of Akamai.

Earthlink has been chosen to provide access for Sony's new Internet device called "e Villa Network Entertainment." We don't know why it's called that either. :-) ELNK closed at 13.23, a loss of 0.86 (-6.10%), on light volume of 1,563,800 shares trading hands.

IBM closed at 115.75, a loss of 0.79 (-0.68%), on light volume of 7,502,500 shares trading hands.

Macromedia was downgraded by Tucker Anthony Sutro from a Market Perform to Underperform. MACR closed at 21.13, down 1.57 (-6.92%), on volume of 1,380,600 shares trading hands.

Motorola closed at 13.93, a loss of 0.95 (-6.38%), on volume of 12,998,900 shares trading hands.

Dell closed at 25.04, a loss of 0.15 (-0.60%), on light volume of 26,451,200 shares trading hands.

Gateway closed at 15.86, a loss of 0.39 (-2.40%), on light volume of 1,306,800 shares trading hands.

Intel closed at 27.61, down 1.45 (-4.99%), on light volume of 41,927,800 shares trading hands.

Microsoft closed at 68.90, a loss of 1.79 (-2.53%), on light volume of 36,020,200 shares trading hands.

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