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CNNfn market movers
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June 18, 1999: 3:06 p.m. ET
Industrial machines rumble up Wall Street while traders ponder Kmart sale
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NEW YORK (CNNfn) - Investors scouring Wall Street for bargains Friday unearthed a few heavy machine and new technology shares, but found the real treasures buried under the premise of potential acquisitions.
Construction and agricultural equipment machinery manufacturers Deere & Co. and Argo Co. quickly constructed a case for their stocks after J.P. Morgan upgraded both companies to "buy" ratings. Argo (AG) rose 1 to 5/8 while Deere & Co. (DE) climbed 2-5/8 to 41-3/16.
Rumbling not far behind was Durakon Industries. which quickly navigated Wall Street's bumpy terrain after the maker of pickup truck bed liners agreed to a $16-per-share buyout from private investment firm LittleJohn & Co. That sent Durakon (DRKN) up 3-1/2 to 15-9/16, or nearly 30 percent.
And trucking firm Covenant Transport (CVTI) had little trouble rigging investors along for the ride after announcing second quarter earnings would be three to five cents above estimates. Traders quickly drove the company's stock up 1-1/4 to 14.
New stocks pique investors' interest
If trucks and industrial machines weren't enough to get investors' hearts racing, two new stocks seemed to provide just the jolt they needed.
Shares of GoTo.com (GOTO), the Internet search engine, provided traders will all the answers they needed, jumping from an opening price of 15 on its first day of trading to 24-15/16 by mid-afternoon.
Concord EFS Inc. (CEFT), a provider of electronic transaction authorization, also enjoyed its first day on the market, trading at 36-3/8 after pricing its initial public offering at 32-1/4 late Thursday.
Nova (NIS) Corp., a provider of credit and debit card transaction software, found its available balance a little higher as well, despite projecting fiscal 2000 earnings would fall short of expectations. The company does see fiscal 1999 earnings being in line with projections, so investors, clearly preferring the short-term view, raised the company's stock 2-1/2 to 23-1/4.
Those looking to beef up their portfolio chose Borg-Wagner Security (BOR), which confirmed it had received an unsolicited preliminary takeover interest from another company and saw its shares rise 4 to 21-1/2.
Window shopping at Kmart
Kmart Corp. attracted scores of shoppers after Business Week reported the discount retailer could be a takeover target for a grocery chain, such as Safeway Inc. (SWY).
Kmart (KM) officials declined to comment on the story, but sources familiar with the company said Kmart President and CEO Floyd Hall has been mulling such a strategy for about a year now. The company's shares rose 1-11/16 to 16-7/8 while Safeway climbed 2-1/4 to 49-11/16.
Micromuse Inc., a consultant specializing in information management problems, was clearly the solution investors seeking profits were looking for after Credit Suisse First Boston nearly doubled its target price for the company to $70 a share. Investors wasted little time heading in that direction, boosting Micromuse (MUSE) shares 7 to 51-3/8.
In the technology sector, computer software manufacturer Adobe Systems (ADBE) gained 5-7/16 to 79-5/16 after beating analysts' earnings expectations by a nickel.
And priceline.com (PCLN) added 4-1/16 to 43 after naming Daniel H. Schulman, 41, the former president of AT&T's Consumer Markets Division as its new president and chief operating officer.
But investors found trading in DA Consulting Group Inc. (DACG), which trains employees to use complex business software, a little more difficult to grasp, sending the company's shares down 3-1/2 to 5-1/4 after the firm said its second-quarter earnings will be 2 cents below expectations.
Likewise, Cotelligent Inc. (CGZ) wasn't feeling very wise after Prudential cut its rating on the company's stock, sending its shares down 2-1/2 to 6 on word the company would lose $13 to $15 million during the second quarter. Analysts had been expecting a profit of 30 cents per share.
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