Here's Muddle in Your Eye

SAN FRANCISCO (01/28/2000) - Internet stocks remained as indecisive as the rest of the technology sector Thursday. Earnings news remained positive for the most part, but there were few other catalysts to drive prices up or down, and the sector bounced around before closing slightly lower. Internet Sector index ended down 4.95, or 0.4 percent, at 1140.73. It traded as low as 1118.54 before coming back in the last hour of trading. The Nasdaq fell 30.35, or 0.75 percent, to 4039.56. The Dow was down 4.97, or 0.05 percent, to 11028.02. As has been the case for much of the month, movement in many stocks revolved around earnings.

Just when it looked like things couldn't get worse for eToys, they did. The online toy store closed down 4.38, or 21 percent, at 16.88 after reporting earnings before the open. Its earnings loss of 52 cents merely matched Street forecasts. That, coupled with uncertainty about when it could begin to reduce losses, combined to drive down the stock. was another high-profile stock that stumbled after earnings, though not as dramatically as eToys. It closed down 2.13, or 3 percent, at 64.13 despite besting earnings estimates with a 6-cent loss versus an 8-cent estimate. But good numbers were anticipated by the market after the company pre-announced earnings earlier in the month. Traders may have been looking for a post-earnings pop (it traded as high as 69.25 early in the session) to get out.

So much for the post-earnings decliners - on to the victors. None came bigger than InfoSpace. The Internet content and infrastructure provider closed up 27.50, or 20 percent, at 167.50 after blowing away earnings estimates with a 5-cent gain (post-split) versus the break-even estimate. That was enough to get the stock on an upward path, but an upgrade by Merrill Lynch in its intermediate term rating on InfoSpace to "buy" from "accumulate" helped propel it to an all-time high of 169.88 intraday. Merrill's new $175 price target already looks in jeopardy.

Exodus Communications posted a 25-cent loss for the fourth quarter, but that was 2 cents better than estimates and good enough to carry the stock up 9.94, or 8 percent, at 129.94.

Among stocks not reporting earnings, there were a couple of standouts. Sycamore Networks closed up 13.19, or 4, at 313.25 after announcing a 3-for-1 stock split. And tumbled 20.28, or 16.6 percent, to 100.88. The company priced a public offering of 8.3 million shares at $110 per share, which was a discount to the 121 level where it closed Wednesday. Momentum took care of the rest.

Join the newsletter!


Sign up to gain exclusive access to email subscriptions, event invitations, competitions, giveaways, and much more.

Membership is free, and your security and privacy remain protected. View our privacy policy before signing up.

Error: Please check your email address.

More about eToysExodusHomeStoreInfoSpacepriceline.comSycamore

Show Comments