<% ' AvantGo:MarketClose %>DJIA             9011.25    +91.66      (+1.03%)
S&P 500          1135.86    +10.14      (+0.90%)
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Value Line ndx    881.02     +1.68      (+0.19%)
30-Year Bond    99 10/32    -23/32  5.29% Yield<% ' AvantGo:End %>

HEROES

<% ' AvantGo:Heroes %>Ah, the wonderful effects of adding the magic ".com" to your company's name... What was once long-distance telecommunications firm Tel-Save Holdings today became America Online-based e-commerce telecommunications services provider Tel-Save.com Inc. <% if gsSubBrand = "aolsnapshot" then Response.Write("(Nasdaq: TALK)") else Response.Write("(Nasdaq: TALK)") end if %>, and the company's stock improved $2 3/16 to $12 15/16. Thankfully for Tel-Save shareholders, there was more news to report than just the new name. The company reported a third-quarter loss of $1.58 per share (before a one-time gain), well off last year's penny per share profit but a nickel ahead of Wall Street's consensus estimate of a loss of $1.63. Gross margins were 18.6%, the company's best figure ever, and Tel-Save expects more margin growth because of further network efficiencies, local-access charge reductions, and lower costs for international services. In other company news, the company named Network Solutions <% if gsSubBrand = "aolsnapshot" then Response.Write("(Nasdaq: NSOL)") else Response.Write("(Nasdaq: NSOL)") end if %> CEO Gabriel Battista its new chairman, CEO, and president, sending Network Solutions' stock down $3 1/8 to $65 3/8.

Removable data storage device maker and Fool Port holding Iomega Corp. <% if gsSubBrand = "aolsnapshot" then Response.Write("(NYSE: IOM)") else Response.Write("(NYSE: IOM)") end if %> zipped ahead $3/8 to $7 3/4 today after two PC manufacturers gave its new Clik! mobile drives the OK in the form of marketing agreements. Compaq Computer <% if gsSubBrand = "aolsnapshot" then Response.Write("(NYSE: CPQ)") else Response.Write("(NYSE: CPQ)") end if %> signed a non-binding letter of intent to bundle Clik!s with its C-series handheld PCs starting next year. Clik! products also won an endorsement from Sharp in connection with its newest line of portable computer products. Meanwhile, Iomega also announced a new line of 250MB Zip drives and disks, expanding the concept past the 100MB threshold. The new Zip drives are compatible with existing disks. For more company news released today in conjunction with the first day of the COMDEX Fall '98 information technology trade show in Las Vegas, click here.

QUICK CUTS: Intel Corp. <% if gsSubBrand = "aolsnapshot" then Response.Write("(Nasdaq: INTC)") else Response.Write("(Nasdaq: INTC)") end if %> rose $3 1/8 to $106 7/8 following reports that the microprocessor company is booking $1 billion a month in Internet orders just months after starting the program. The company said at a semiannual meeting with analysts Friday that almost half of its total revenues now come from the Internet... Online services provider America Online <% if gsSubBrand = "aolsnapshot" then Response.Write("(NYSE: AOL)") else Response.Write("(NYSE: AOL)") end if %> gained $6 5/8 to $146 5/8 after BancBoston Robertson Stephens introduced a cash flow model on the company rated "strong buy"... Internet portal company Lycos Inc. <% if gsSubBrand = "aolsnapshot" then Response.Write("(Nasdaq: LCOS)") else Response.Write("(Nasdaq: LCOS)") end if %> jumped ahead $8 5/8 to $59 5/8 after Merrill Lynch upgraded its short-term rating on the company to "buy" from "accumulate." Other Internet companies posting gains today included Egghead.com <% if gsSubBrand = "aolsnapshot" then Response.Write("(Nasdaq: EGGS)") else Response.Write("(Nasdaq: EGGS)") end if %>, which scrambled up $1 1/8 to $14 1/4, Go2Net <% if gsSubBrand = "aolsnapshot" then Response.Write("(Nasdaq: GNET)") else Response.Write("(Nasdaq: GNET)") end if %>, which went up $4 1/8 to $43 3/8, and Infoseek <% if gsSubBrand = "aolsnapshot" then Response.Write("(Nasdaq: SEEK)") else Response.Write("(Nasdaq: SEEK)") end if %>, which added $2 1/16 to $33 13/16.

PC graphics accelerator firm 3Dfx Interactive <% if gsSubBrand = "aolsnapshot" then Response.Write("(Nasdaq: TDFX)") else Response.Write("(Nasdaq: TDFX)") end if %> moved ahead $5/8 to $15 3/8 following its announcement at the Comdex show of its Voodoo3 product line of chips for generating 2D and 3D graphics... Printer, workstation, PC, and medical and industrial metrology equipment manufacturer Hewlett-Packard <% if gsSubBrand = "aolsnapshot" then Response.Write("(NYSE: HWP)") else Response.Write("(NYSE: HWP)") end if %> ticked up $7/8 to $66 1/8 before reporting Q4 earnings after the bell. It reported fiscal Q4 operating profit of $0.79 (before charges) per share, beating last year's $0.75 figure as well as the market's $0.74 consensus estimate. More company news is available here... Brazilian telephone company Telebras' <% if gsSubBrand = "aolsnapshot" then Response.Write("(NYSE: TBR)") else Response.Write("(NYSE: TBR)") end if %> American depositary receipts rang up $4 1/4 to $84 1/4 after 12 spin-offs from the communications giant began trading on the New York Stock Exchange.

Broadcast and wireless communications sites operator American Tower Corp. <% if gsSubBrand = "aolsnapshot" then Response.Write("(NYSE: AMT)") else Response.Write("(NYSE: AMT)") end if %> buzzed ahead $3 1/2 to $22 1/2 after it agreed to acquire two companies: privately owned TeleCom Towers LLC, which serves wireless users in the Washington, D.C. metro area, for $155 million in cash and stock and $30 million in assumed debt, and OmniAmerica Inc. <% if gsSubBrand = "aolsnapshot" then Response.Write("(Nasdaq: XMIT)") else Response.Write("(Nasdaq: XMIT)") end if %>, which operates telecommunications sites across the country, for approximately $365 million in stock. OmniAmerica rose $6 to $23 1/2 this morning... Exide Corp. <% if gsSubBrand = "aolsnapshot" then Response.Write("(NYSE: EX)") else Response.Write("(NYSE: EX)") end if %>, the world's largest car battery maker, ran up $3 1/8 to $17 5/8 after the company said former Chrysler Corp. President and COO Robert Lutz was elected chairman, president, and CEO. Lutz joins the company Dec. 1.

German enterprise software company SAP AG <% if gsSubBrand = "aolsnapshot" then Response.Write("(NYSE: SAP)") else Response.Write("(NYSE: SAP)") end if %> rose $2 7/16 to $42 7/8 after New Era of Networks <% if gsSubBrand = "aolsnapshot" then Response.Write("(Nasdaq: NEON)") else Response.Write("(Nasdaq: NEON)") end if %> announced contracts to integrate SAP products at companies including Coca-Cola Co. <% if gsSubBrand = "aolsnapshot" then Response.Write("(NYSE: KO)") else Response.Write("(NYSE: KO)") end if %> and life sciences company Monsanto <% if gsSubBrand = "aolsnapshot" then Response.Write("(NYSE: MTC)") else Response.Write("(NYSE: MTC)") end if %>. New Era earned $2 1/2 to close at $61 15/16... Monsanto, meanwhile, grew $2 to $40 9/16 following reports of a definitive agreement to sell its non-Roundup lawn and garden business to The Scotts Co. <% if gsSubBrand = "aolsnapshot" then Response.Write("(NYSE: SMG)") else Response.Write("(NYSE: SMG)") end if %> for about $300 million. Scotts rose $15/16 to $34 1/8 today... Apparel designer and marketer Kenneth Cole Productions <% if gsSubBrand = "aolsnapshot" then Response.Write("(NYSE: KCP)") else Response.Write("(NYSE: KCP)") end if %> buckled up $1 7/8 to $19 15/16 on reports that the company is comfortable with full-year 1998 earnings estimates of between $1.17 and $1.20 per share.

Industrial, office and hotel property manager American Real Estate Partners <% if gsSubBrand = "aolsnapshot" then Response.Write("(NYSE: ACP)") else Response.Write("(NYSE: ACP)") end if %> jumped $2 1/2 to $9 3/4 after financier Carl Icahn said he intends to initiate a $10.50 per unit offer for up to 10 million of the company's depositary units beginning Nov. 20. That would represent approximately 22% of the company's outstanding units, bringing Icahn's stake to nearly 90%... Regional competitive local exchange carrier (CLEC) Advanced Communications Group <% if gsSubBrand = "aolsnapshot" then Response.Write("(NYSE: ADG)") else Response.Write("(NYSE: ADG)") end if %> dialed up a $11/16 gain to $6 7/16 following its announcement of a financing commitment of up to $20 million from RCC Finance Group for installation of switching and network equipment... Satellite-to-car radio broadcaster CD Radio <% if gsSubBrand = "aolsnapshot" then Response.Write("(Nasdaq: CDRD)") else Response.Write("(Nasdaq: CDRD)") end if %> spun ahead $2 to $36 1/8 after it said affiliates of Apollo Management will buy $200 million of newly issued preferred stock.

Mobile communications software maker Geoworks Corp. <% if gsSubBrand = "aolsnapshot" then Response.Write("(Nasdaq: GWRX)") else Response.Write("(Nasdaq: GWRX)") end if %> raced ahead $3 5/8, or 175.8%, to $5 11/16 after it unveiled a new graphical application environment for wireless phones. Mitsubishi introduced an "enhanced" phone using Geoworks technology today... Motorola <% if gsSubBrand = "aolsnapshot" then Response.Write("(NYSE: MOT)") else Response.Write("(NYSE: MOT)") end if %> rolled up $3 to $58 after Brown Brothers Harriman & Co. reiterated its "long-term buy" rating on the cellular phone and telecommunications equipment company... Construction aggregates manufacturer CalMat Co. <% if gsSubBrand = "aolsnapshot" then Response.Write("(NYSE: CZM)") else Response.Write("(NYSE: CZM)") end if %> jumped $3 7/16 to $30 5/8 after Vulcan Materials Co. <% if gsSubBrand = "aolsnapshot" then Response.Write("(NYSE: VMC)") else Response.Write("(NYSE: VMC)") end if %> said it will buy CalMat for $31 a share in cash -- a 14% premium over CalMat's closing price Friday of $27 3/16. Including assumed debt of $130 million, the deal is valued at a total of $890 million. Vulcan gained $2 7/16 to $125 1/8.

The American depositary receipts of Hoechst AG <% if gsSubBrand = "aolsnapshot" then Response.Write("(NYSE: HOE)") else Response.Write("(NYSE: HOE)") end if %> and Rhone-Poulenc SA <% if gsSubBrand = "aolsnapshot" then Response.Write("(NYSE: RP)") else Response.Write("(NYSE: RP)") end if %> advanced this morning -- Hoechst's $2 1/4 to $47 1/16 and Rhone-Poulenc's $1 1/2 to $47 7/8 -- following a report in the London Sunday Times that the companies are in talks to merge, potentially creating a global pharmaceutical and agricultural products giant... Specialty chemicals maker Aceto Corp. <% if gsSubBrand = "aolsnapshot" then Response.Write("(Nasdaq: ACET)") else Response.Write("(Nasdaq: ACET)") end if %> bubbled $7/8 higher to $12 3/4 after a report in Barron's said the company might be a good buy at current prices... The magazine also helped push shares of home furnishings retailer Pier 1 Imports <% if gsSubBrand = "aolsnapshot" then Response.Write("(NYSE: PIR)") else Response.Write("(NYSE: PIR)") end if %> up $15/16 to $10 7/16 after it published bullish comments from CEO Marvin Girouard... Chattem Inc. <% if gsSubBrand = "aolsnapshot" then Response.Write("(Nasdaq: CHTT)") else Response.Write("(Nasdaq: CHTT)") end if %>, maker of Gold Bond and Icy Hot medical ointments, warmed up $3 15/16 to $36 7/16 after it announced an agreement to buy Dexatrim, Sportscreme, Aspercreme, and other brands from privately owned Thompson Medical Co. for $95 million.

Casual restaurant operator Outback Steakhouse <% if gsSubBrand = "aolsnapshot" then Response.Write("(Nasdaq: OSSI)") else Response.Write("(Nasdaq: OSSI)") end if %> carved up $1 7/8 to $36 1/2 after Credit Suisse First Boston reiterated a "strong buy" rating on the company... Paper bag and corrugated cardboard maker Stone Container Corp. <% if gsSubBrand = "aolsnapshot" then Response.Write("(NYSE: STO)") else Response.Write("(NYSE: STO)") end if %> wrapped up gains of $11/16 to $12 1/2 after J.P. Morgan upgraded the company to "buy" from "market perform." The firm said Stone Container's financial outlook would be weak if not for its planned $6.37 billion merger with Jefferson Smurfit Corp. <% if gsSubBrand = "aolsnapshot" then Response.Write("(Nasdaq: JJSC)") else Response.Write("(Nasdaq: JJSC)") end if %>... Brokerage and investment banking firm Legg Mason <% if gsSubBrand = "aolsnapshot" then Response.Write("(NYSE: LM)") else Response.Write("(NYSE: LM)") end if %> jogged ahead $1 5/16 to $26 3/16 after Legg Mason Wood Walker, its securities brokerage subsidiary, said it created a five-person technology research group.<% ' AvantGo:End %>

GOATS

<% ' AvantGo:Goats %>Several oil and gas drilling and services firms lost ground today as Iraq dodged its way out of anticipated air strikes by the U.S. and other U.N. countries over the weekend. Iraqi President Saddam Hussein agreed to cooperate unconditionally with U.N. weapons inspectors, dashing oil traders' hopes that a military clash in the Persian Gulf would help reduce the global oil glut. As a result, the December crude oil futures contract on the New York Mercantile Exchange today fell below the psychologically important $13 a barrel level for the first time since August. In sympathy, Pride International <% if gsSubBrand = "aolsnapshot" then Response.Write("(NYSE: PDE)") else Response.Write("(NYSE: PDE)") end if %> slipped $1 1/16 to $9, Noble Drilling <% if gsSubBrand = "aolsnapshot" then Response.Write("(NYSE: NE)") else Response.Write("(NYSE: NE)") end if %> dropped $15/16 to $14 3/8, Weatherford International <% if gsSubBrand = "aolsnapshot" then Response.Write("(NYSE: WFT)") else Response.Write("(NYSE: WFT)") end if %> declined $1 15/16 to $21 13/16, Varco International <% if gsSubBrand = "aolsnapshot" then Response.Write("(NYSE: VRC)") else Response.Write("(NYSE: VRC)") end if %> slid $1 to $8 1/4, National-Oilwell <% if gsSubBrand = "aolsnapshot" then Response.Write("(NYSE: NOI)") else Response.Write("(NYSE: NOI)") end if %> lost $1 1/8 to $12 3/4, Smith International <% if gsSubBrand = "aolsnapshot" then Response.Write("(NYSE: SII)") else Response.Write("(NYSE: SII)") end if %> fell $2 11/16 to $30 13/16, and BJ Services <% if gsSubBrand = "aolsnapshot" then Response.Write("(NYSE: BJS)") else Response.Write("(NYSE: BJS)") end if %> sank $1 1/16 to $17 1/8.

Wall Street's version of the Grand Coulee Dam burst today, sending the sky-high share prices of several Internet-related stocks streaming down the river to rest with other hype-related sediment from days gone by. AvTel Communications <% if gsSubBrand = "aolsnapshot" then Response.Write("(Nasdaq: AVCO)") else Response.Write("(Nasdaq: AVCO)") end if %> sank $20 1/2 to $10 1/2 after rocketing an eye-popping 1200% on Thursday before being halted. The company's shares never traded on Friday, and AvTel issued a press release late in the day responding to some reports by news organizations about Thursday's jump, which was related to the firm's launch of asymmetric digital subscriber line (ADSL) service in Santa Barbara, California. Meanwhile, entertainment and consumer products retailer and direct marketer K-tel International <% if gsSubBrand = "aolsnapshot" then Response.Write("(Nasdaq: KTEL)") else Response.Write("(Nasdaq: KTEL)") end if %> slid another $2 1/8 to $17 5/8 after losing 29% Friday following its announcement of a fiscal Q1 loss. Recent Internet initial public offerings were also washed down, with theglobe.com <% if gsSubBrand = "aolsnapshot" then Response.Write("(Nasdaq: TGLO)") else Response.Write("(Nasdaq: TGLO)") end if %> losing $14 3/4 to $48 3/4 and EarthWeb <% if gsSubBrand = "aolsnapshot" then Response.Write("(Nasdaq: EWBX)") else Response.Write("(Nasdaq: EWBX)") end if %> shedding $4 3/4 to $62 1/4.

QUICK CUTS: Dynamic random access memory (DRAM) chip maker Micron Technology <% if gsSubBrand = "aolsnapshot" then Response.Write("(NYSE: MU)") else Response.Write("(NYSE: MU)") end if %> fell $1 13/16 to $42 11/16 after Gruntal & Co. cut its rating to "buy" from "strong buy" based on valuation... Instant photographic products maker Polaroid <% if gsSubBrand = "aolsnapshot" then Response.Write("(NYSE: PRD)") else Response.Write("(NYSE: PRD)") end if %> slid $1 1/2 to $24 3/16 after Schroder & Co. downgraded the firm to "perform in line" from "outperform"... Healthcare management software developer HBO & Co. <% if gsSubBrand = "aolsnapshot" then Response.Write("(Nasdaq: HBOC)") else Response.Write("(Nasdaq: HBOC)") end if %> slipped $13/16 to $22 1/16 following a downgrade from BT Alex. Brown to "buy" from "strong buy"... Office furniture maker Steelcase Inc. <% if gsSubBrand = "aolsnapshot" then Response.Write("(NYSE: SCS)") else Response.Write("(NYSE: SCS)") end if %> lost $1 1/4 to $16 3/8 after saying weaker-than-expected orders will result in lower year-over-year fiscal Q3 sales, reduced margins, and EPS between $0.33 and $0.35. The First Call mean estimate had called for EPS of $0.40.

The American depositary shares of steel maker British Steel PLC <% if gsSubBrand = "aolsnapshot" then Response.Write("(NYSE: BST)") else Response.Write("(NYSE: BST)") end if %> dropped $1 1/8 to $17 3/8 after the company said its fiscal first half net income dropped 17% in domestic currency terms to �79 million, or about $132.3 million, due mostly to falling steel prices. The company also said it may report a full-year loss for the first time in five years if steel prices continue to slide... Semiconductor chemical mechanical planarization (CMP) systems designer SpeedFam International <% if gsSubBrand = "aolsnapshot" then Response.Write("(Nasdaq: SFAM)") else Response.Write("(Nasdaq: SFAM)") end if %> hit a speed bump and fell $1 to $15 11/16 after the company said slower sales will result in a fiscal Q2 loss between $0.25 and $0.29 per share, worse than the loss of $0.12 per share expected by analysts. NationsBanc Montgomery Securities lowered its rating to "hold" from "buy" on Friday, citing increased competition in the CMP area from capital equipment heavyweight Applied Materials <% if gsSubBrand = "aolsnapshot" then Response.Write("(Nasdaq: AMAT)") else Response.Write("(Nasdaq: AMAT)") end if %>.

Real estate lender Amresco Inc. <% if gsSubBrand = "aolsnapshot" then Response.Write("(Nasdaq: AMMB)") else Response.Write("(Nasdaq: AMMB)") end if %> dropped $11/16 to $7 11/16 after saying it will report a $85 million to $95 million fiscal Q4 loss, which includes losses from the previously announced sales of its commercial mortgage and home equity loan portfolios. The First Call mean estimate had called for earnings of $0.05 per share in the quarter... Aircraft fasteners maker Tristar Aerospace <% if gsSubBrand = "aolsnapshot" then Response.Write("(NYSE: TSX)") else Response.Write("(NYSE: TSX)") end if %> glided $1 3/8 lower to $7 15/16 after BT Alex. Brown downgraded the company to "buy" from "strong buy" and reduced its fiscal 1999 earnings estimate to $1.20 per share from $1.24 per share.<% ' AvantGo:End %>

FOOL ON THE HILL
An Investment Opinion
by Alex Schay

Information Technology Outsourcing 1999

<% ' AvantGo:FOTH %>Increasingly, it is said that the role of information technology (IT) is shifting from its former status of serving as an "enabling" function -- where business strategies could be more quickly and effectively realized -- to that of a true "driver," where a company's strategic positioning is propelled by considerations concerning information technology.

Ultimately, the objective of most information technology projects is to improve the competitive position of a company (client), and this can be accomplished by satisfying a number of intermediate objectives along the way -- which include improving employee productivity and ramping up customer service. However, return on investment is always the most reactive element in the IT equation.

Is technology truly a competitive weapon and therefore a necessity? An acceptance of this statement would lead investors to the conclusion that even during an economic slowdown, IT budgets should not contract (assuming no saturation currently). Of course, this conclusion is based on a vague premise that must be offset by considerations regarding budgets, priorities, and shareholders. Although in a recent Chief Information Officer (CIO) Survey conducted by Lehman Brothers, it was estimated that average growth in IT budgets will moderate to about 5-7% in 1999 and not "decline," as is the view seemingly built into many of these stocks today. The study noted that more than 80% of respondents (100 polled from mostly large firms) reported that spending on custom software development will be "severely curtailed and/or that reliance on consultants will moderate in 1999."

This report was statistically significant enough for Lehman to downgrade Cambridge Technology Partners <% if gsSubBrand = "aolsnapshot" then Response.Write("(Nasdaq: CATP)") else Response.Write("(Nasdaq: CATP)") end if %> to "neutral" from a "buy" today, as well as highlight the fortunes of a couple of other firms exposed materially to the custom software development segment.

Symbol   Rev.% from custom   Price Decline
          software dev.             (11/16)
CATP          20%       $13/16 to $20 5/16
SAPE       10-20%      $1 9/16 to $42 7/16
WHIT       20-30%          $3/8 to $19 5/8

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Contributing Writers Yi-Hsin Chang (TMF Puck), a Fool Brian Graney (TMF Panic), another Fool David Marino-Nachison (TMF Braden), a new Fool Editing Brian Bauer (TMF Hoops), another Fool Bob Bobala (TMF Bobala), a Fool's Fool Jennifer Silber (TMF Amused), Fool at last