TECH STOCKS: McAfee Rises On Intel Buy, But Most Techs Fall

Date : 08/19/2010 @ 5:07PM
Source : Dow Jones News
Stock : Brocade Communications Systems, Inc. (BRCD)
Quote : 12.73  0.0 (0.00%) @ 2:05AM

TECH STOCKS: McAfee Rises On Intel Buy, But Most Techs Fall

Mcafee (NYSE:MFE)
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By Rex Crum

McAfee Inc. was a rare bright spot among technology stocks Thursday, as its shares rose 57% following Intel Corp.'s surprise $7.7 billion deal to acquire the security-software firm on a day when most of the sector fell along with the broad market.

McAfee (MFE) climbed $17.08 a share to close at $47.01 after Intel (INTC) said it would acquire the company for $48 a share -- a 60% premium over McAfee's Wednesday closing price. Intel said McAfee would help boost the security of its mobile-wireless chip products, in particular.

"McAfee is the next step in this [mobility] strategy, and the right security partner for us," Intel Chief Executive Paul Otellini said in a statement announcing the deal.

After the deal's completion, which still needs the approval of McAfee shareholders, the company will become a wholly owned subsidiary of Intel's software and services group.

Intel's shares gave up 69 cents, or 3.5%, to close at $18.90

McAfee rival Symantec Inc. (SYMC) benefited from the deal, rising 78 cents a share, or 6.2%, to close at $13.37.

Other chip stocks fell along with Intel, as Advanced Micro Devices Inc. (AMD) fell 15 cents, or more than 2%, to close at $6.42, and Micron Technology Inc. (MU) gave up 27 cents a share, or 3.6%, to close at $7.18.

Google Inc. (GOOG) fell $14.48 a share, or almost 3%, to $467.97 on the sixth anniversary of the Internet search leader's IPO. In 2004, Google went public using a modified Dutch auction to price shares at $85 a share in an initial offering of $1.67 billion. The stock opened at $100, providing those investors who still hold them a roughly 370% return.

Brocade Communications Systems Inc. (BRCD) shares fell 39 cents, or 7.6%, to $4.75. Late Wednesday, the storage-technology company turned in a fiscal third-quarter profit after reporting a loss a year ago. However, Brocade's fourth-quarter earnings and revenue outlooks fell short of analysts' expectations.

Other leading tech stocks were in the red, with declines from Apple Inc. (AAPL), Microsoft Corp. (MSFT), Oracle Corp. (ORCL), SanDisk Corp. (SNDK) and Yahoo Inc. (YHOO)

One company bucking tech's downward trend was graphics chip maker Nvidia Corp. (NVDA), which rose 56 cents a share, or 6%, to $9.88.

Hewlett-Packard Co. (HPQ) fell 60 cents at $40.76 and Dell Inc. (DELL) gave up 15 cents to close at $12.04. Both computer giants report quarterly results after the market close.

The Nasdaq Composite Index (RIXF) fell almost 37 points, or 1.7%, to close at 2,178. The overall market was disappointed by the latest first-time filings for state unemployment benefits. The number of filers unexpectedly rose last week to 500,000, the highest level since last November.


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