DJIA             9184.94   +43.10      (+0.47%) 
 S&P 500          1126.34    +2.69      (+0.24%) 
 Nasdaq           1903.87   +16.73      (+0.89%) 
 Value Line ndx    998.38    +4.11      (+0.41%) 
 30-Year Bond   102 12/32   -13/32  5.95% Yield 
 

HEROES

Market Guide <% if gsSubBrand = "aolsnapshot" then Response.Write("(Nasdaq: MARG)") else Response.Write("(Nasdaq: MARG)") end if %> shot up $15 1/16 to $23 after announcing it will provide stock screening and other financial information to America Online's <% if gsSubBrand = "aolsnapshot" then Response.Write("(NYSE: AOL)") else Response.Write("(NYSE: AOL)") end if %> investment research area. Someone call the fire department, because this former penny stock is en fuego. Over the past two trading days, the stock has jumped an astounding 667% from its closing price of $3 per share on Friday. That's pretty good performance from a company that has lost a total of $130,410 (or a cumulative $0.04 per share) over the four most recent quarters on $6.14 million in total revenues. Moreover, the deal with AOL, which was actually signed last September, is not even the company's biggest contract. In 1996, the company signed a bigger multi-year deal with Reuters Ltd. <% if gsSubBrand = "aolsnapshot" then Response.Write("(Nasdaq: RTRSY)") else Response.Write("(Nasdaq: RTRSY)") end if %> to provide the British news service with access to its financial database of over 10,000 companies listed on U.S. exchanges.

Oil drillers and oil services firms climbed today after Deutsche Morgan Grenfell started coverage of both sectors and assigned "buy" ratings to numerous companies. Marine Drilling <% if gsSubBrand = "aolsnapshot" then Response.Write("(Nasdaq: MDCO)") else Response.Write("(Nasdaq: MDCO)") end if %> rose $1 7/16 to $25 5/8, Cliffs Drilling Co. <% if gsSubBrand = "aolsnapshot" then Response.Write("(NYSE: CDG)") else Response.Write("(NYSE: CDG)") end if %> gained $3 1/16 to $50 1/16, and Diamond Offshore Drilling <% if gsSubBrand = "aolsnapshot" then Response.Write("(NYSE: DO)") else Response.Write("(NYSE: DO)") end if %> tacked on $1 15/16 to $49. Among the oil services firms, Schlumberger <% if gsSubBrand = "aolsnapshot" then Response.Write("(NYSE: SLB)") else Response.Write("(NYSE: SLB)") end if %> added $3 11/16 to $80 5/8 and Cooper Cameron Corp. <% if gsSubBrand = "aolsnapshot" then Response.Write("(NYSE: RON)") else Response.Write("(NYSE: RON)") end if %> was lifted $2 3/4 to $65 3/16. Smith International <% if gsSubBrand = "aolsnapshot" then Response.Write("(NYSE: SII)") else Response.Write("(NYSE: SII)") end if %> advanced $3 1/2 to $60 11/16 after receiving an "accumulate" rating.

Covance Inc. <% if gsSubBrand = "aolsnapshot" then Response.Write("(NYSE: CVD)") else Response.Write("(NYSE: CVD)") end if %> rose $1 13/16 to $22 15/16 after reporting fiscal Q1 EPS of $0.18 versus $0.15 a year ago, which was in line with the Street estimate. The company, which conducts preclinical trials and provides drug development services for pharmaceutical companies, saw its net income rise 21% to $10.5 million during the quarter on a 24% jump in revenues to $168.5 million. Covance was spun off from Corning Inc. <% if gsSubBrand = "aolsnapshot" then Response.Write("(NYSE: GLW)") else Response.Write("(NYSE: GLW)") end if %> along with diagnostic testing firm Quest Diagnostics <% if gsSubBrand = "aolsnapshot" then Response.Write("(NYSE: DGX)") else Response.Write("(NYSE: DGX)") end if %> last year as Corning shifted its focus to its fiber-optic wire business. The firm trades at 27.9 times expected fiscal 1998 earnings of $0.83 per share, which is below the respective 45.2 and 39.4 forward multiples of rivals Quintiles Transnational <% if gsSubBrand = "aolsnapshot" then Response.Write("(Nasdaq: QTRN)") else Response.Write("(Nasdaq: QTRN)") end if %> and Parexel International <% if gsSubBrand = "aolsnapshot" then Response.Write("(Nasdaq: PRXL)") else Response.Write("(Nasdaq: PRXL)") end if %>.

QUICK TAKES: IBM <% if gsSubBrand = "aolsnapshot" then Response.Write("(NYSE: IBM)") else Response.Write("(NYSE: IBM)") end if %> picked up $6 13/16 to $118 after reporting fiscal Q1 EPS of $1.06 versus $1.16 a year ago, beating the Street estimate by a penny... Retail and commercial bank Chase Manhattan <% if gsSubBrand = "aolsnapshot" then Response.Write("(NYSE: CMB)") else Response.Write("(NYSE: CMB)") end if %> rose $4 7/16 to $139 1/8 after reporting Q1 EPS from operations of $2.35, topping the First Call mean estimate of $2.26... Drug maker Pfizer <% if gsSubBrand = "aolsnapshot" then Response.Write("(NYSE: PFE)") else Response.Write("(NYSE: PFE)") end if %> rose $2 5/8 to $116 on continued positive sentiment surrounding its new Viagra impotence treatment... Network computer storage firm StorageTek <% if gsSubBrand = "aolsnapshot" then Response.Write("(NYSE: STK)") else Response.Write("(NYSE: STK)") end if %> added $3 to $83 1/2 after signing an R&D agreement with Compaq Computer <% if gsSubBrand = "aolsnapshot" then Response.Write("(NYSE: CPQ)") else Response.Write("(NYSE: CPQ)") end if %> to develop an industry standard open storage architecture.

Defense contractor Tracor Inc. <% if gsSubBrand = "aolsnapshot" then Response.Write("(Nasdaq: TTRR)") else Response.Write("(Nasdaq: TTRR)") end if %> rose $2 15/16 to $39 5/16 after agreeing to a $40 per share cash tender offer from British intelligent electronic systems provider General Electric Co. PLC... Information technology research firm Gartner Group <% if gsSubBrand = "aolsnapshot" then Response.Write("(Nasdaq: GART)") else Response.Write("(Nasdaq: GART)") end if %> picked up $1 5/8 to $33 5/8 on a Salomon Smith Barney upgrade to "buy" from "outperform"... Internet software developer HomeCom Communications <% if gsSubBrand = "aolsnapshot" then Response.Write("(Nasdaq: HCOM)") else Response.Write("(Nasdaq: HCOM)") end if %> advanced $5 7/16 to $11 15/16 after Bloomberg News reported that the firm acquired Internet development and hosting firm Insurance Resource Center Inc. for an unspecified sum... Lernout and Hauspie Speech Products <% if gsSubBrand = "aolsnapshot" then Response.Write("(Nasdaq: LHSPF)") else Response.Write("(Nasdaq: LHSPF)") end if %> climbed $6 7/8 to $63 1/8 after Lehman Brothers started coverage of the maker of speech recognition products with a "buy" rating... Professional color portrait company PCA International <% if gsSubBrand = "aolsnapshot" then Response.Write("(Nasdaq: PCAI)") else Response.Write("(Nasdaq: PCAI)") end if %> rose $4 7/16 to $25 15/16 after agreeing to sell a 95% to 97% stake in the company to private investment firm Jupiter Partners LP at $26.50 per share.

Lincare Holdings <% if gsSubBrand = "aolsnapshot" then Response.Write("(Nasdaq: LNCR)") else Response.Write("(Nasdaq: LNCR)") end if %> moved up $5 7/8 to $80 7/8 after the home healthcare firm company set a two-for-one stock spilt... Internet investment company CMG Information Services <% if gsSubBrand = "aolsnapshot" then Response.Write("(Nasdaq: CMGI)") else Response.Write("(Nasdaq: CMGI)") end if %> advanced $5 1/8 to $100 after announcing a two-for-one stock split... Real estate investment trust RFS Hotel Investors <% if gsSubBrand = "aolsnapshot" then Response.Write("(NYSE: RFS)") else Response.Write("(NYSE: RFS)") end if %> climbed $1 1/4 to $20 3/4 after agreeing to merge with fellow REIT Equity Inns Inc. <% if gsSubBrand = "aolsnapshot" then Response.Write("(NYSE: ENN)") else Response.Write("(NYSE: ENN)") end if %> for $990 million in stock and assumed debt... Iomega Corp. <% if gsSubBrand = "aolsnapshot" then Response.Write("(Nasdaq: IOM)") else Response.Write("(Nasdaq: IOM)") end if %> tacked on $15/16 to $8 7/16 after licensing the manufacturing rights for its Clik! mobile storage device to Japan's NEC Corp. <% if gsSubBrand = "aolsnapshot" then Response.Write("(Nasdaq: NIPNY)") else Response.Write("(Nasdaq: NIPNY)") end if %>. NEC will also help develop new versions of the device, Iomega said.

Fundtech Ltd. <% if gsSubBrand = "aolsnapshot" then Response.Write("(Nasdaq: FNDTF)") else Response.Write("(Nasdaq: FNDTF)") end if %> gained $2 5/8 to $24 5/8 after the payment and cash management software developer agreed to acquire the cash management and wire transfer businesses of CheckFree Corp. <% if gsSubBrand = "aolsnapshot" then Response.Write("(Nasdaq: CKFR)") else Response.Write("(Nasdaq: CKFR)") end if %> for $18.25 million in cash... Wireless equipment systems company Telxon Corp. <% if gsSubBrand = "aolsnapshot" then Response.Write("(Nasdaq: TLXN)") else Response.Write("(Nasdaq: TLXN)") end if %> was lifted $4 7/16 to $32 1/8 after The Wall Street Journal reported that bar code scanner technology developer Symbol Technologies <% if gsSubBrand = "aolsnapshot" then Response.Write("(NYSE: SBL)") else Response.Write("(NYSE: SBL)") end if %> offered to buy the company for as much as $38 per share, which would be a 37% premium to Telxon's closing price of $27 11/16 yesterday... Internet auctioneer ONSALE Inc. <% if gsSubBrand = "aolsnapshot" then Response.Write("(Nasdaq: ONSL)") else Response.Write("(Nasdaq: ONSL)") end if %> was bid up $2 11/16 to $32 7/16 after agreeing to become the "premier auction content provider" for the Yahoo! Computers site launched today by Internet content aggregator Yahoo! <% if gsSubBrand = "aolsnapshot" then Response.Write("(Nasdaq: YHOO)") else Response.Write("(Nasdaq: YHOO)") end if %>.

Relational database management software developer Red Brick Systems <% if gsSubBrand = "aolsnapshot" then Response.Write("(Nasdaq: REDB)") else Response.Write("(Nasdaq: REDB)") end if %> added $2 1/2 to $7 5/8 after online bookseller Amazon.com <% if gsSubBrand = "aolsnapshot" then Response.Write("(Nasdaq: AMZN)") else Response.Write("(Nasdaq: AMZN)") end if %> chose the company to provide data warehousing services... EMC Corp. <% if gsSubBrand = "aolsnapshot" then Response.Write("(NYSE: EMC)") else Response.Write("(NYSE: EMC)") end if %> rose $2 13/16 to $42 5/16 after Bear Stearns started coverage of the computer storage systems manufacturer with a "buy" rating... Atlanta-based bank and thrift holding company Premier Bancshares <% if gsSubBrand = "aolsnapshot" then Response.Write("(AMEX: PMB)") else Response.Write("(AMEX: PMB)") end if %> gained $7/8 to $25 7/8 after Interstate/Johnson Lane upgraded the company to "strong buy" from "long-term buy."

Earnings Movers

Quintiles Transnational <% if gsSubBrand = "aolsnapshot" then Response.Write("(Nasdaq: QTRN)") else Response.Write("(Nasdaq: QTRN)") end if %> up $2 15/16 to $46 15/16; Q1 EPS: $0.24 vs. $0.16 last year; Estimate: $0.22

Sundstrand Corp. <% if gsSubBrand = "aolsnapshot" then Response.Write("(NYSE: SNS)") else Response.Write("(NYSE: SNS)") end if %> up $4 3/4 to $64 7/16; Q1 EPS: $0.88 vs. $0.58 last year; Estimate: $0.73

Ben & Jerry's Homemade <% if gsSubBrand = "aolsnapshot" then Response.Write("(Nasdaq: BJICA)") else Response.Write("(Nasdaq: BJICA)") end if %> up $1 1/2 to $20 1/4; Q1 EPS: $0.05 vs. $0.15 loss last year; Estimate: $0.01 loss

Citrix Systems <% if gsSubBrand = "aolsnapshot" then Response.Write("(Nasdaq: CTXS)") else Response.Write("(Nasdaq: CTXS)") end if %> up $6 5/16 to $60 13/16; Q1 EPS: $0.36 vs. $0.18 last year; Estimate: $0.34

MedQuist Inc. <% if gsSubBrand = "aolsnapshot" then Response.Write("(Nasdaq: MEDQ)") else Response.Write("(Nasdaq: MEDQ)") end if %> up $3 1/2 to $45; Q1 EPS: $0.23 vs. $0.15 last year; Estimate: $0.19

Network Associates <% if gsSubBrand = "aolsnapshot" then Response.Write("(Nasdaq: NETA)") else Response.Write("(Nasdaq: NETA)") end if %> up $6 5/8 to $70 7/8; $0.56 vs. $0.18 (before charges) last year; Estimate: $0.54

Physio-Control International <% if gsSubBrand = "aolsnapshot" then Response.Write("(Nasdaq: PHYS)") else Response.Write("(Nasdaq: PHYS)") end if %> up $3 1/2 to $22 1/8; Q1 EPS: $0.16 vs. $0.15 last year; Estimate: $0.10

GOATS

SmithKline Beecham <% if gsSubBrand = "aolsnapshot" then Response.Write("(NYSE: SBH)") else Response.Write("(NYSE: SBH)") end if %>, whose products include Geritol, Nicorette gum, Tums, Contac flu and cold drug, and Aquafresh toothpaste, dropped $2 3/4 to $58 1/8 in heavy trading after the London-based pharmaceutical giant reported first quarter earnings per American depositary receipt (ADR) of about $0.43 per share compared with $0.40 for the prior-year period. The First Call mean estimate was $0.47. The company's sales were hurt by a strong sterling against most currencies and an "unusually low incidence of respiratory illness." Although prescription drug sales gained 10%, sales of antibiotic Augmentin grew a mere 2%, and sales of anti-infectives Amoxil and Timentin both fell 6%. Sales of heartburn medication Tagamet dropped 19%. Amid stiff competition, SmithKline plans to increase R&D investment by 16% to 17% over last year to support several new drugs nearing approval, including diabetes drug Avandia, asthma medicine Ariflo, idoxifene for osteoporosis and advanced breast cancer, and antibiotic quinolone. As a result, the company expects low double-digit EPS growth this year.

Atlanta-based beverage bottler Coca-Cola Enterprises <% if gsSubBrand = "aolsnapshot" then Response.Write("(NYSE: CCE)") else Response.Write("(NYSE: CCE)") end if %> fell slightly, losing $1 1/8 to $40 after reporting a first quarter loss of $0.13 per share compared with a pro forma Q1 1997 loss of $0.18 per share and ahead of analysts' estimates. The company was helped by its $50 million buyback of 1.5 million shares. Coca-Cola's <% if gsSubBrand = "aolsnapshot" then Response.Write("(NYSE: KO)") else Response.Write("(NYSE: KO)") end if %> anchor bottler and distributor (44% owned by Coke) was unable to grow sales per case due to competitor-driven discounting, though consolidated bottle and can volume rose 8%. The company's cash operating profit (defined as earnings before deducting interest, taxes, depreciation, amortization, and other nonoperating items) increased about 7% year-on-year, adjusting for acquisitions, currency changes, and the additional four selling days in Q1 1998. Still, the company said it is "on track" to meet 10% cash operating profit growth for the year. Although the company expects Q2 cash operating profit to grow more slowly than in Q1 due to continued infrastructure spending and unusually strong prior-year results, it anticipates the growth rate will exceed 10% in the second half of the year.

QUICK CUTS: AT&T <% if gsSubBrand = "aolsnapshot" then Response.Write("(NYSE: T)") else Response.Write("(NYSE: T)") end if %> was disconnected for another $1 3/4 to finish at $63 7/16 after yesterday reporting weak sales growth along with Q1 EPS that topped estimates. The nation's largest long-distance carrier managed to cut expenses, but sales from consumer services fell 5% from the prior-year quarter on slightly lower calling volumes... Some major Internet companies eased today on profit taking. Content aggregator Infoseek Corp. <% if gsSubBrand = "aolsnapshot" then Response.Write("(Nasdaq: SEEK)") else Response.Write("(Nasdaq: SEEK)") end if %> dropped $2 5/16 to $36 7/8. Yahoo! Inc. <% if gsSubBrand = "aolsnapshot" then Response.Write("(Nasdaq: YHOO)") else Response.Write("(Nasdaq: YHOO)") end if %> was trimmed $2 15/32 to $123 9/32. Lycos Inc. <% if gsSubBrand = "aolsnapshot" then Response.Write("(Nasdaq: LCOS)") else Response.Write("(Nasdaq: LCOS)") end if %> dipped $1 9/16 to $66 9/16. Netscape Communications <% if gsSubBrand = "aolsnapshot" then Response.Write("(Nasdaq: NSCP)") else Response.Write("(Nasdaq: NSCP)") end if %> shed $1 1/16 to $24 1/2. And Amazon.com <% if gsSubBrand = "aolsnapshot" then Response.Write("(Nasdaq: AMZN)") else Response.Write("(Nasdaq: AMZN)") end if %> slipped $1 3/16 to $93 1/16.

Computer products direct marketer CDW Computer Centers <% if gsSubBrand = "aolsnapshot" then Response.Write("(Nasdaq: CDWC)") else Response.Write("(Nasdaq: CDWC)") end if %> sank $9 13/16 to $51 1/16 after reporting Q1 earnings of $0.68 per share compared with $0.52 in the year-earlier period... Prison management company Corrections Corp. of America <% if gsSubBrand = "aolsnapshot" then Response.Write("(NYSE: CCA)") else Response.Write("(NYSE: CCA)") end if %> dropped another $2 7/16 to $27 7/16 after yesterday announcing a merger with prison real estate investment trust CCA Prison Realty Trust <% if gsSubBrand = "aolsnapshot" then Response.Write("(NYSE: PZN)") else Response.Write("(NYSE: PZN)") end if %>, which was down $2 3/8 to $35 1/8. As part of the deal, CCA also acquired privately held prison owner and management company U.S. Corrections Corp. for $265 million. PaineWebber downgraded Corrections Corp. to "neutral" from "buy." Competitor Wackenhut Corrections <% if gsSubBrand = "aolsnapshot" then Response.Write("(NYSE: WHC)") else Response.Write("(NYSE: WHC)") end if %> also fell, losing $1 1/2 to $26.

Digital signal processor manufacturer DSP Group <% if gsSubBrand = "aolsnapshot" then Response.Write("(Nasdaq: DSPG)") else Response.Write("(Nasdaq: DSPG)") end if %> plunged $4 5/16 to $20 1/8 after reporting Q1 earnings of $0.31 per share versus $0.21 for the year-earlier period and the Zacks mean estimate of $0.30... Manufactured housing company Oakwood Homes <% if gsSubBrand = "aolsnapshot" then Response.Write("(NYSE: OH)") else Response.Write("(NYSE: OH)") end if %> plummeted $5 5/16 to $30 1/8 after reporting Q2 earnings of $0.16 per share (including an after-tax charge of $0.21), down from $0.38 for the prior-year period. Even before charges, Q2 EPS fell short of the First Call mean estimate of $0.46... Associates First Capital <% if gsSubBrand = "aolsnapshot" then Response.Write("(NYSE: AFS)") else Response.Write("(NYSE: AFS)") end if %> slipped $1 17/32 to $77 23/32 on news that the company has agreed to pay $896 million to acquire SPS Transaction Services, a credit-card transaction processor controlled by Morgan Stanley Dean Witter <% if gsSubBrand = "aolsnapshot" then Response.Write("(NYSE: MWD)") else Response.Write("(NYSE: MWD)") end if %>.

Interneuron Pharmaceuticals <% if gsSubBrand = "aolsnapshot" then Response.Write("(Nasdaq: IPIC)") else Response.Write("(Nasdaq: IPIC)") end if %> sank another $1 3/16 to $6 3/4 after the biopharmaceutical company yesterday withdrew its new drug application for its CerAxon stroke treatment to "obtain additional clinical data"... Amway Asia Pacific <% if gsSubBrand = "aolsnapshot" then Response.Write("(NYSE: AAP)") else Response.Write("(NYSE: AAP)") end if %> tanked $3 3/16 to $13 15/16 after announcing that the Chinese government has ordered an immediate cessation of direct selling activities by all direct selling companies in response to a number of abuses and illegal pyramid schemes... Robbins & Myers <% if gsSubBrand = "aolsnapshot" then Response.Write("(NYSE: RBN)") else Response.Write("(NYSE: RBN)") end if %> dropped $4 1/4 to $32 11/16 after Furman Selz lowered its rating on the company to "hold" from "buy" on concern that earnings over the next six to 12 months could be at risk. The 1998 EPS estimate was cut to $2.55 from $2.70, and 1999 EPS was changed to $2.90 from $3.05.

Cohr Inc. <% if gsSubBrand = "aolsnapshot" then Response.Write("(Nasdaq: CHRI)") else Response.Write("(Nasdaq: CHRI)") end if %> fell $1 5/16 to $6 13/16 on news of a class action lawsuit against the company alleging that the healthcare outsourcing company and certain of its officers violated securities laws by disseminating false financial statements about the company and its performance... Industrial and automotive parts manufacturer Mark IV Industries <% if gsSubBrand = "aolsnapshot" then Response.Write("(NYSE: IV)") else Response.Write("(NYSE: IV)") end if %> was cut $9/16 to $20 15/16 after announcing that it expects Q1 and Q2 earnings to be $0.03 to $0.05 below last year's levels. The company added that fiscal 1999 (ending Feb. 28, 1999) earnings won't meet expectations... Cement and steelmaker Texas Industries <% if gsSubBrand = "aolsnapshot" then Response.Write("(NYSE: TXI)") else Response.Write("(NYSE: TXI)") end if %> lost $2 1/16 to $65 15/16 after announcing plans to sell 2.9 million shares at $66.50 a share to raise about $184.3 million after expenses.

Earnings Movers

APAC TeleServices <% if gsSubBrand = "aolsnapshot" then Response.Write("(Nasdaq: APAC)") else Response.Write("(Nasdaq: APAC)") end if %> down $1 3/32 to $10 7/32; Q1 EPS: $0.10 vs. $0.18 last year; Estimate: $0.11

Borden Chemicals and Plastics <% if gsSubBrand = "aolsnapshot" then Response.Write("(NYSE: BCU)") else Response.Write("(NYSE: BCU)") end if %> down $1 1/4 to $7; Q1 EPS: $0.22 loss vs. $0.12 loss last year; Estimate: $0.09 loss

Computer Horizons Corp. <% if gsSubBrand = "aolsnapshot" then Response.Write("(Nasdaq: CHRZ)") else Response.Write("(Nasdaq: CHRZ)") end if %> down $4 1/8 to $45; Q1 EPS: $0.27 vs. $0.15 last year; Estimate: $0.27

Concentric Network <% if gsSubBrand = "aolsnapshot" then Response.Write("(Nasdaq: CNCX)") else Response.Write("(Nasdaq: CNCX)") end if %> down $2 5/16 to $24 5/8; Q1 EPS: a loss of $1.43 vs. a loss of $2.17; Estimate: a loss of $1.10

Corn Products International <% if gsSubBrand = "aolsnapshot" then Response.Write("(NYSE: CPO)") else Response.Write("(NYSE: CPO)") end if %> down $1 1/4 to $36 5/8; Q1 EPS: $0.21 vs. a loss of $0.24; Estimate: $0.21

Infinium Software <% if gsSubBrand = "aolsnapshot" then Response.Write("(Nasdaq: INFM)") else Response.Write("(Nasdaq: INFM)") end if %> down $1 5/8 to $18; Q2 EPS: $0.10 vs. $0.06 (before charges) last year; Estimate: $0.10

Integrated Circuit Systems <% if gsSubBrand = "aolsnapshot" then Response.Write("(Nasdaq: ICST)") else Response.Write("(Nasdaq: ICST)") end if %> down $3 1/16 to $16 1/16; Q3 EPS: $0.48 vs. a loss of $0.68; Estimate: $0.48

Integrated Silicon Solution <% if gsSubBrand = "aolsnapshot" then Response.Write("(Nasdaq: ISSI)") else Response.Write("(Nasdaq: ISSI)") end if %> down $15/16 to $9 3/8; Q1 EPS: $0.00 vs. $0.08 loss last year; Estimate: $0.03

IONA Technologies <% if gsSubBrand = "aolsnapshot" then Response.Write("(Nasdaq: IONAY)") else Response.Write("(Nasdaq: IONAY)") end if %> down $3 to $32 5/8; Q1 EPS: $0.10 vs. $0.08 last year; Estimate: $0.13

ProxyMed <% if gsSubBrand = "aolsnapshot" then Response.Write("(Nasdaq: PILL)") else Response.Write("(Nasdaq: PILL)") end if %> down $1 5/8 to $14 7/8; Q1 EPS: $0.14 loss vs. $0.62 loss last year

Reltec Corp. <% if gsSubBrand = "aolsnapshot" then Response.Write("(NYSE: RLT)") else Response.Write("(NYSE: RLT)") end if %> down $2 1/8 to $47; Q1 EPS: $0.06 vs. $0.04 last year; Estimate: $0.05

Remedy Corp. <% if gsSubBrand = "aolsnapshot" then Response.Write("(Nasdaq: RMDY)") else Response.Write("(Nasdaq: RMDY)") end if %> down $1 1/16 to $24; Q1 EPS: $0.08 vs. $0.16 last year; Estimate: $0.06

Zomax Optical Media <% if gsSubBrand = "aolsnapshot" then Response.Write("(Nasdaq: ZOMX)") else Response.Write("(Nasdaq: ZOMX)") end if %> down $2 to $17 3/4; Q1 EPS: $0.13 vs. $0.07 last year; Estimate: $0.10

FOOL ON THE HILL
An Investment Opinion
by Dale Wettlaufer

Feels Like '96

The other day, I wrote a Fool Plate Special column on the speculative juices that are flowing in the market. Though I mentioned "1995" in the title, probably because I was thinking of the unreal pop Netscape <% if gsSubBrand = "aolsnapshot" then Response.Write("(Nasdaq: NSCP)") else Response.Write("(Nasdaq: NSCP)") end if %> made in its first day of public trading that year, I was really thinking more of 1996. Netscape was really a seminal event leading up to 1996, as it was the first company basing its business model primarily on the Internet to make a big IPO splash.

1996 was a rarer phenomenon, though. No one can say that Netscape was a horrible company without a real business, unlike what one can say about some of the companies that were being traded in the spring 1996 mania. "Mania" is a term used very casually by some to describe the valuations on super-high quality companies such as Coca-Cola <% if gsSubBrand = "aolsnapshot" then Response.Write("(NYSE: KO)") else Response.Write("(NYSE: KO)") end if %>, but it would have to get to a market cap of a couple of trillion dollars to trade at the same insane valuations at which some of the dreck that is trading this week is valued. At least with Coke, you'd only face the prospect of losing 90% of your money if you bought at 100 times revenues and liquidated the position some years later. With some of today's South Sea Bubble descendants, you have a chance of eventually losing your entire investment.

Such is the fate of investors who buy into the ridiculous notion of "buy low, sell high" or the terrific "get in on the ground floor," as if you have to get in on the ground floor to do terrifically in equity investments. To do well buying high and never selling, or hopefully selling at much higher prices down the road, one can buy medium quality to good to excellent to world-class companies. Buying low-quality companies is a sure way to generate bottom-of-the barrel results. In fact, buying the sort of things that are moving today can actually be destructive to one's long-term success, because if you bought hoping the next sucker would bail you out or you bought without looking at the fundamentals just because it was going up, the positive reinforcement from today's action will keep you coming back to very low-quality stocks. Such is the nature of random positive reinforcement. Like a rat tapping a lever to receive the pellets that are delivered at only random intervals, market participants buying into some of the stocks below are acting out a real-time replay of these famous experiments in animal behavior.

Here's a list of some of the stocks in today's run-up, in no particular order and with no specific comment on each, just yet. Some of these might be fine companies, but market participants and traders running these things to the moon because of any connection, however tenuous, to the Internet, creates a good deal of danger for those not paying close attention to what they're doing.

7th Level <% if gsSubBrand = "aolsnapshot" then Response.Write("(Nasdaq: SEVL)") else Response.Write("(Nasdaq: SEVL)") end if %> up $7 7/16 at $9 1/4
K-tel <% if gsSubBrand = "aolsnapshot" then Response.Write("(Nasdaq: KTEL)") else Response.Write("(Nasdaq: KTEL)") end if %> up $2 1/4 at $43 7/8
Homecom Communications <% if gsSubBrand = "aolsnapshot" then Response.Write("(Nasdaq: HCOM)") else Response.Write("(Nasdaq: HCOM)") end if %> up $5 7/16 to $11 15/16
Red Brick Systems <% if gsSubBrand = "aolsnapshot" then Response.Write("(Nasdaq: REDB)") else Response.Write("(Nasdaq: REDB)") end if %> up $2 1/2 to $7 5/8
Cybershop International <% if gsSubBrand = "aolsnapshot" then Response.Write("(Nasdaq: CYSP)") else Response.Write("(Nasdaq: CYSP)") end if %> up $4 5/8 to $16 1/2
Telescan Inc. <% if gsSubBrand = "aolsnapshot" then Response.Write("(Nasdaq: TSCN)") else Response.Write("(Nasdaq: TSCN)") end if %> up $3 1/16 at $9 7/8
Peapod Inc. <% if gsSubBrand = "aolsnapshot" then Response.Write("(Nasdaq: PPOD)") else Response.Write("(Nasdaq: PPOD)") end if %> up $1 1/4 at $9 3/16
Online System Services <% if gsSubBrand = "aolsnapshot" then Response.Write("(Nasdaq: WEBB)") else Response.Write("(Nasdaq: WEBB)") end if %> up $2 7/16 to $14 5/16
Data Broadcasting <% if gsSubBrand = "aolsnapshot" then Response.Write("(Nasdaq: DBCC)") else Response.Write("(Nasdaq: DBCC)") end if %> up $2 9/16 to $8 3/4
Rocky Mountain Internet <% if gsSubBrand = "aolsnapshot" then Response.Write("(Nasdaq: RMII)") else Response.Write("(Nasdaq: RMII)") end if %> up $2 3/16 to $10 1/4
ODS Networks <% if gsSubBrand = "aolsnapshot" then Response.Write("(Nasdaq: ODSI)") else Response.Write("(Nasdaq: ODSI)") end if %> up $2 at $7 3/4
Audio Book Club <% if gsSubBrand = "aolsnapshot" then Response.Write("(AMEX: KLB)") else Response.Write("(AMEX: KLB)") end if %> up $5 7/16 at $11
DBT Online <% if gsSubBrand = "aolsnapshot" then Response.Write("(NYSE: DBT)") else Response.Write("(NYSE: DBT)") end if %> up $4 3/16 at $26 15/16
PC Quote <% if gsSubBrand = "aolsnapshot" then Response.Write("(AMEX: PQT)") else Response.Write("(AMEX: PQT)") end if %> up $2 7/8 to $4 3/8
Sharper Image <% if gsSubBrand = "aolsnapshot" then Response.Write("(Nasdaq: SHRP)") else Response.Write("(Nasdaq: SHRP)") end if %> up $3 11/16 to $8

There were a few others that didn't quite make it here. ICC Technologies <% if gsSubBrand = "aolsnapshot" then Response.Write("(Nasdaq: ICGN)") else Response.Write("(Nasdaq: ICGN)") end if %>, a manufacturer of climate control systems, is pulling a Diana Corp. in deciding to diversify by acquiring "Internet services business" Rare Medium. Diana Corp. was the meat and seafood distributor, Georgia's largest, that decided to get into the data switching business. Its stock experienced regular doublings in 1996 before tumbling off the New York Stock Exchange. It now trades as Coyote Network Systems Inc. in the pink sheets. Sure, ICC shouldn't be ridiculed for allocating capital to a growing industry, but with its stock trading at nearly three times its week-ago level, the investors were quite quick to add $85 million to its market cap in light of the fact that the deal could have been largely stock-financed, meaning the added market cap was larger than just $85 million with new shares thrown in there. Add the uncertainty of a humidifier company's executives getting into a totally different line of business where the real talent could bolt as soon as any golden handcuffs expire, and this week's move was a heady one.

There are other reminders of those scary days of spring 1996. Net.Radio company Navarre Corp. <% if gsSubBrand = "aolsnapshot" then Response.Write("(Nasdaq: NAVR)") else Response.Write("(Nasdaq: NAVR)") end if %> surged $3 1/8 to $9 1/2 today on no news, reminiscent of its 1996 round trip from the low single-digits by way of detour to its May high of $18 5/16. The explosive move in shares of music distributor K-tel <% if gsSubBrand = "aolsnapshot" then Response.Write("(Nasdaq: KTEL)") else Response.Write("(Nasdaq: KTEL)") end if %> over the last week, from below $10 to today's close of $43 7/8 is similarly bizarre and calls to mind the 1995 run-up in the share of Zenith <% if gsSubBrand = "aolsnapshot" then Response.Write("(NYSE: ZE)") else Response.Write("(NYSE: ZE)") end if %> on cable modem hype.

Like Zenith, K-tel is a company that everyone remembers, which some take to mean that there is a vibrant brand name to lend credence to the story. Maybe so, but to hear from an analyst initiating coverage of K-tel with a "strong buy" rating because of its successful history of music retailing, I would just point investors to K-tel's stock chart. Outside of this week's manic run-up, the company has built zero shareholder value since starting to trade as K-tel in 1993. The Internet doesn't build the market for music. It may expand it for that marginal buyer who doesn't order things over the telephone or who is an impulsive buyer while sitting at the computer, but it's not a whole new world out there. K-tel is far behind the curve and already operates in a medium where advertising costs are a fraction of what the Internet advertising costs and where operating costs per order -- for a person sitting at a phone with an X-terminal computer -- are lower than putting in Alpha servers, running a T-3, and paying out the ying yang for exclusive marketing agreements.

Shopping.com <% if gsSubBrand = "aolsnapshot" then Response.Write("(Nasdaq: IBUY)") else Response.Write("(Nasdaq: IBUY)") end if %> is another interesting example of a stock that harkens back to 1996 or even to the Go-Go late '60s. Gerry Tsai would love this one. It had $376,822 in revenues and $2.4 million in losses through nine months of 1997, very little general consumer recognition, a non-focused website, and a market cap of $73 million. Anyone remember International Automated Systems <% if gsSubBrand = "aolsnapshot" then Response.Write("(Nasdaq: IAUS)") else Response.Write("(Nasdaq: IAUS)") end if %>? This was the company that said its modem would get 1.2 gigabits per second over a normal phone line. "Investors" actually bought it. Shopping.com looks similarly dubious from a longer view, but that might not be the company's fault. It's the fault of either shorts getting squeezed or anyone buying into concepts with zero regard for value.

Now, I might have painted some great companies with one brush in the above column, but on a day like today, watching unknown companies double and triple just because they're involved in the Internet, makes me want to retch. Not because some trader is going to lose his shirt or win someone else's and not because some housewife that gets a kick out of day-trading (you see this sort of thing on the data services commercials on CNBC) will lose her daugher's college money because the market metes out random, positive reinforcement of speculative mindless trading. There is nada I can do about that. I retch because I actually rail against this sort of behavior like I'm some sort of freaking Alan Abelson railing against the new era. If I were to say I care about people blowing their retirement because they were stupid, I would be seen as disingenuous.

I also retch because I know -- I KNOW -- what the outcome of most of these companies will be. Most will eventually sink back into obscurity and lose people money. That's because the great majority of companies are mediocre, a small minority stink, and a smaller minority are great. A tiny fraction is world-class. Most of these companies are overvalued on current fundamentals, have overinflated growth expectations built in, and are priced beyond intrinsic value even if the market is there for them to grow. If you're in some of these and bought because they put out a press release mentioning they're doing business on the Internet, good luck.

CONFERENCE CALLS

Please see the Motley Fool's Conference Calls page for call information and links to synopses.

WE DELIVER - Get The Evening News delivered
to your e-mailbox every evening!

ANOTHER FOOLISH THING

See something moving a stock that we didn't cover?
E-mail the Fool News Team
and we will start working on the story.
Unfortunately, we cannot answer every e-mail
or respond to individual questions.

Contributing Writers Yi-Hsin Chang (TMF Puck), a Fool Brian Graney (TMF Panic), Fool Two Alex Schay (TMF Nexus6), Fool, too Dale Wettlaufer (TMF Ralegh), Final Fool Editing Brian Bauer (TMF Hoops), another Fool Jennifer Silber (TMF Amused), Fool at last