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CNNfn market movers
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February 12, 1999: 2:31 p.m. ET
Promise of sterilized beef lifts Food Tech but profits sink software firms
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NEW YORK (CNNfn) - Earnings disappointments and stern words from Wall Street analysts drove many stocks lower on Friday, with the volatile technology sector taking the brunt of the market's attention.
Potash Corp. (POT) slid 2-1/16 to 58-7/16 after influential investment firm Morgan Stanley lowered its rating on the fertilizer giant from "outperform" to "neutral." The company overnight reported that higher income taxes had caused a dramatic fourth-quarter profit slump, although earnings were still within range of forecasts.
Overnight tidings of flat fourth-quarter earnings also caused investors to punish eyewear maker Sola International (SOL), which fell 2-1/8 to 10-9/16 after being downgraded by Merrill Lynch to "long-term accumulate" from "long-term buy."
After a gloomy week of canceled flights and legal action, American Airlines said it has lost about $48 million so far due to an ongoing labor dispute, driving shares of holding company AMR Corp. (AMR) down 1-1/4 to 54-3/16.
Wall Street reacted more positively to news that Goldman Sachs had added electronics manufacturer Honeywell (HON) to its "recommended" list of stocks, boosting shares up 1 to 71-7/8.
Food Technology Services (VIFL) soared 1-15/16 to 4-7/16 after the U.S. Department of Agriculture approved the irradiation of food as a method for killing harmful bacteria in packaged red meat. Fellow food sterilizer SteriGenics International (STER) also climbed 2-1/4 to 19-7/8 on the news.
Software firms in undertow
The technology sector was broadly softer as some investors took profits from the Nasdaq's record climb Thursday, while others returned to earlier concerns that valuations are outpacing profit potential.
Several software firms, including J.D. Edwards (JDEC), led the decline.
J.D. Edwards fell 3-15/16 to 14-15/16 after warning shareholders that first-quarter profits will fall far short of analyst predictions. CS First Boston lowered its forecasts to take this into account, while lowering its rating on the stock to "hold."
Management software firm TeleTech Holdings (TTEC) also retreated from a "challenging" quarterly profit report, falling 2-3/16 to 7-1/4.
Although TeleTech's fourth-quarter per-share profits edged up to 9 cents from 8 cents a year ago, Needham & Co. said it expects Year 2000 computer problems and other external factors to depress the company's profit margins in 1999.
Level 8 Systems (LVEL) sank 1 to 10-1/2 after telling shareholders that it will restate its fiscal 1998 profits to better reflect the value of its purchase of rival software firm Momentum Software in first-quarter 1998. The company did not say whether the adjustments will increase or decrease its previously stated profits.
Digital switching company World Access (WAXS) fell 3-5/16 to 8-3/16 after reporting that fourth-quarter costs related to its aggressive 1998 acquisitions program were higher than expected, driving profits to miss forecasts. Prudential Securities downgraded the stock to "hold" from "accumulate."
On the upside, Helix Technology (HELX) rode recent strength in the chip-equipment industry, firming 7/8 to 21-3/4 after reporting a break-even fourth quarter. Wall Street had expected a loss.
"1998 market conditions were the worst the global semiconductor capital equipment industry has ever seen," said Helix President Robert J. Lepofsky. "Since bottoming in the third quarter of last year, order booking rates have continued to rise. Order trends in the first quarter are quite strong."
The news led both Adams Harkness and Needham & Co. to up their investment ratings on Helix stock.
Financial news provider Individual Investor Group (INDI) climbed 2-7/32 to 8-13/32 after a Web tie-in with portal giant Yahoo! (YHOO) went online.
"Rumors of the companies' relationship were already circulating, but now it looks like INDI will get more hits," said Barry King, analyst at Southwest Research Partners.
"Hits" are a primary gauge of a Web site's popularity, operating much like viewer ratings in broadcast media.
Another barrage of IPOs
Friday also saw the birth of several new stocks, with most reporting strong progress in their opening day.
Onyx Software (ONXS), which produces automation software, celebrated in its first day of public trading, surging 8-1/2 to 21-1/2 from its opening mark of 13.
A later start caused Serena Software (SRNA) to lag behind, climbing only 2-7/8 to 15-7/8 from the same starting price of $13.
The hint of Internet connections helped e-commerce software maker Bottomline Technologies rise 6-3/4 to 19-3/4, again from an offering price of $13.
However, some recent IPOs found their sophomore day of public trading more bittersweet.
Although the Internet's Prodigy (PRGY) built up speed, climbing 6-1/8 to 34-1/4, staffing firm Korn/Ferry International (KFY) deepened its retreat, sinking 1-3/8 to 11-5/8. Korn/Ferry had priced at $14 Thursday. 
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