Morning Stock Notes: 1/7/00
Notes on GM, Ford, DaimlerChrysler, Lucent, Nortel, Seagram, RealNetworks, SAP, Baan, Intel, Gateway, and Walmart.
GM (GM) announced today its Saturn unit will shutter both of its factories until January 18. Saturn's meager sales increase of 0.3% for fiscal 1999, despite the launch of its midsize sedan and robust industry-wide sales, underscores GM's problems company-wide. Still, the move should help GM reduce its bloated inventory levels, which have been rising and are now at levels higher than Ford (F) or DaimlerChrysler's (DCX).
After 15 straight quarters of beating estimates, telecommunication-equipment giant Lucent Technologies (LU) stunned Wall Street late Thursday when it announced that earnings for the December quarter would miss analysts' estimates by a whopping 30%. Although this is a major black eye for CEO Rich McGinn and his team, Lucent's shares have sold off so sharply that investors would be wise to seriously consider bottom-fishing. After taking into account the lowered estimates, the stock now trades at about 35 times this year's expected earnings per share. This is not an unreasonable price to pay--assuming, of course, that Lucent fulfills its promises to get things back on track in the latter half of the year. See full newswire for details.
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