Commerce One tumbles
|
|
November 17, 2000: 12:40 p.m. ET
B2B firm sees stock sell-off on earnings rumors; analysts discount stories
|
NEW YORK (CNNfn) - Commerce One Inc. stock tumbled Friday as speculation swirled on Wall Street that it would miss forecasts for the fourth-quarter, but the business-to-business software company denied the rumors.
Commerce One (CMRC: Research, Estimates) shares fell as much as 18 percent during the trading day. However, they recovered to close down $5.69 at $47.62, a loss of 11 percent.
The company issued a statement repeating its financial guidance for the fourth quarter of 2000 and the next fiscal year. Commerce One said it expects fourth quarter 2000 revenue to be in the range of $173 million to $177 million, with an operating loss per share of approximately 7 cents.
For fiscal year 2001, the company expects revenue to be in the range of $800 million to $825 million. That operating loss is consistent with the current consensus analyst estimate, according to First Call.
Commerce One also said that operating earnings per share are expected to break even in the second quarter of 2001.
Jefferies & Co. analyst Richard Williams told CNNfn.com that the broker's traders heard rumors that a Commerce One internal memo had been circulated saying the company would miss its fourth-quarter forecast.
"These were motivational materials routinely promulgated amongst the sales force," John Biestman, head of investor relations for Commerce One, told Reuters. "Apparently someone with some measure of influence misconstrued the meaning of the memo. We categorically deny the rumors."
Before the company issued its statement, Williams told CNNfn.com that he doubted the Commerce One rumors were true.
"For a variety of reasons, we believe that's unlikely," Williams said. "In our experience, when you're going to miss a quarter, you usually don't send a memo.
"Also, they're halfway through their quarter. In the software business, usually the last month represents 70 to 80 percent of their business and the last week it's sometimes 50 percent of that. So, six weeks in, unless you're having a total disaster, it's unlikely that this is the issue," Williams said.
The company's fourth quarter ends Dec. 31 and results likely will be reported in early January.
-- Reuters contributed to this story
|
|
Commerce One
|
Note: Pages will open in a new browser window
External sites are not endorsed by CNNmoney
|
|
|
|
|
|