By Rex Crum
Tech stocks were mostly on the rise Thursday, but the sector's
gains were tempered by big declines from the likes of Nvidia Corp.,
Akamai Technologies Inc. and Symantec Corp. following a combination
of negative forecasts and analysts' ratings downgrades.
The Nasdaq Composite Index (RIXF) rose 3 points to 2,275, as its
mild gains were overshadowed by the sector's decliners.
Nvidia (NVDA) fell 83 cents a share, or more than 8%, to $9.31
after the graphics chip maker slashed its second-quarter revenue
forecast late Wednesday. Nvidia now expects to report sales of $800
million to $820 million, down from its prior forecast of $950
million to $970 million in revenue.
FBR Capital Markets analyst Craig Berger cut his rating on
Nvidia's stock to market perform from outperform and also lowered
his price target on the company's stock to $10 a share from $18. In
a research note, Berger said one of the reasons for the downgrade
was that "Apple may expel Nvidia's chipsets from its PCs sooner
than expected."
Berger also cut his rating on Advanced Micro Devices Inc. (AMD)
to market perform from outperform, due to sector weakness and
execution issues at the No. 2 PC chip maker. AMD's shares fell 30
cents, to 3.6%, to $7.69.
Another FBR analyst, Daniel Ives, cut his rating on
security-software company Symantec (SYMC). Ives cited Symantec's
"soft June results and weak outlook," for the ratings cut. Late
Wednesday, Symantec reported an increase in its quarterly earnings,
but gave a forecast that disappointed Wall Street analysts.
Akamai Technologies Inc. (AKAM) fell $4.64 a share, or 10.5%, to
$39.44 after the company reported second-quarter results late
Wednesday that were in line with expectations, but failed to raised
its third-quarter estimates above analysts' prior forecasts.
Other losses came from Broadcom Corp. (BRCM), Intel Corp.
(INTC), Hewlett-Packard Co. (HPQ) and Research In Motion Ltd.
(RIMM).
Despite the broad losses, some sector leaders managed to eke out
small gains.
Microsoft Corp. (MSFT) remained up by 3 cents a share at $25.98
as the company prepared to hold its annual analyst day meeting at
its Redmond, Wash. headquarters.
Motorola Inc. (MOT) rose 20 cents, or 2.5%, to $7.87 after the
mobile-communications company reported a sharp increase in its
second-quarter earnings before the market opened.
Business-software company Citrix Systems Inc. (CTXS) rose $7.17
a share, or more than 15%, to $54.49 following the company's strong
second-quarter results and upbeat outlook. Robert W. Baird analyst
Steven Ashley raised his rating on Citrix's stock to outperform, or
buy, following the company's report.