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CNNfn market movers
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May 3, 1999: 2:42 p.m. ET
Technology, entertainment the focus of investors as Dow approaches 11K
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NEW YORK (CNNfn) - There were plenty of proverbial lions and tigers but few bears Monday as investors took a shine to entertainment issues and other consumer-oriented stocks, helping push the Dow Jones industrial average to record territory and within a hair's breadth of the 11,000-mark.
Circus Circus (CIR) was in the act with its shares surging almost 20 percent. The entertainment firm's stock jumped 4-3/16 to 25-1/4 after it said it expects to post first-quarter operating earnings of 40 to 42 cents per share, well above analysts' present forecasts of around 25 cents a share and almost double the 23 cents a share it made in the first quarter a year ago. The company will report its results the third week of this month. It also said its board authorized a share repurchase program for up to 15 percent of the outstanding shares and agreed to change company's name to Mandalay Resort Group.
Adding to the festivities was Carnival (CCL). The world's largest cruise-line firm was raised to "buy" from "market perform" by Donaldson Lufkin & Jenrette analyst Brian Egger, who also put a target price of $52 on the stock. Its shares rose 1-13/16, or 4.3 percent, to 43-11/16.
Not to be outdone, Cellular Communications of Puerto Rico (CLRP) rose 4-9/16, or 19 percent, to 28-5/16. The cellular phone company said SBC Communications (SBC) and Telefonos de Mexico (TMX) agreed to buy it for $814 million in cash and assumed debt.
And Circuit City Stores (CC) rose 2-15/16 to 64-7/16 after the No. 2 U.S. consumer-electronics chain was raised to "buy" from "hold" by analyst Scott Ciccarelli at Gerard Klauer Mattison & Co. Ciccarelli said the company could find a partner for its startup movie-rental technology called Digital Video Express, or Divx, which would help bolster Circuit City's earnings. He also said Circuit City's stock could rise to 80 within the next 12 months.
Techs gain again
Technology firms once again performed well Monday, making last week's slump an even more distant memory. Employee benefits and human resources firm ABR Information Services (ABRX) was one of the more notable risers, climbing 7-1/2 to 25, after information services company Ceridian said Monday it will buy ABR in a deal worth about $750 million. Ceridian (CEN) will pay $25.50 each in cash for each outstanding share of ABR, financing the deal from existing cash and loans.
VLSI Technology (VLSI) gained 1-15/16 to 20-13/16 after Philips Electronics NV, Europe's largest chipmaker, raised its offer to buy VLSI by 24 percent, winning over management at the semiconductor maker and bringing the value of Philips' purchase to $1.27 billion. Philips plans to use the acquisition as a platform for expansion in North America. VLSI designs and makes integrated circuits for wireless communications, networking and consumer digital entertainment.
Internet publishing and network firm theglobe.com (TGLO) surged 3-1/2 to 63-5/8 after it posted a narrower-than-expected first-quarter loss. The pro-forma net loss for the quarter, which excluded amortization of some products it bought, was $4.9 million, or 47 cents per share, compared with a loss of $2 million, or 76 cents per share, in the first quarter of 1998. Analysts polled by First Call had forecast a 55-cent loss for the quarter.
Qualcomm (QCOM) shares surged 12-5/8 to 212-5/8 after analyst Michael E. Ching at Merrill Lynch raised his per-share earnings estimate to $4 from $3.70 and raised his 2000 EPS estimate to $5.50 from $5. Ching's 12-month target price is $225 per share. His long-term rating on the stock remains a ''buy.'' Qualcomm develops and manufactures communications technologies and products.
Investors also took a shine to financial services shares after a report that manufacturing output rose at a slower-than-anticipated pace in April bolstered optimism that U.S. growth may have peaked, allowing the Federal Reserve to keep interest rates at current levels. Higher rates erode the value of corporate earnings, particularly among banks and brokerages, by making it more expensive for them to borrow money.
At your financial service
Shares of TD Bank (TD) rose after it announced Friday that it plans to sell part of its discount brokerage arm as a public entity, a move it hopes will raise as much as $1 billion. The brokerages will form a new company called TD Waterhouse Securities Inc., based in New York. Waterhouse offers discount brokerage services in the United States while a sister firm, Green Line, provides the same services in Canada. Shares in Canada's fourth-biggest bank rose 1-9/16 to 55 in New York.
Southwest Securities Group (SWS) shares rose 4-3/16 to 57-1/8 after the investment firm said Friday it plans to sell municipal bonds and other securities to investors through a new Internet investment site.
Delphi Financial Group (DFG) also benefited from the fray, rising 9-3/8, more than 25 percent, to 40-1/2. The insurer sold Unicover Managers Inc., a unit associated with a reinsurer that lost money in workers' compensation insurance, according to press reports.
And drugs were all the rage among investors optimistic about the long-term health of financial markets -- and the need among aging Americans for proper medical and heath care.
Pharmacopeia (PCOP) gained 1-15/16 to 9-1/16 after analyst Kevin C. Tang at BT Alex. Brown Inc. raised the rating on the stock to a "strong buy" from a "buy." Pharmacopeia provides drug-discovery technology to pharmaceutical research firms.
Centocor (CNTO) rose 1-11/16 to 46-1/16 and traded as high as 47 on expectations that Johnson & Johnson (JNJ) is close to an agreement to buy out the biotechnology company, according to media reports. Centocor's stock has jumped 27 percent since talk of a takeover begin in mid-April. 
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