Tuesday, December 22, 1998

"You can't achieve anything without getting in someone's way." -- Abba Eban

Latest Market Numbers

iMac, youMac

I scream, you scream, we all scream for iMac?

According to market researcher PC Data, Apple Computer's (Nasdaq: AAPL) iMac was the top-selling personal computer in stores and through mail-order catalogs last month and for the 3 1/2 months since its product launch in August. But before you get too excited, the numbers are somewhat misleading because the iMac comes in just one model, while other computers are available in several different models that are counted separately in terms of sales. Plus, retail and mail-order sales represent roughly 15% to 20% of the world's overall computer market.

The sleek, translucent, easy-to-use iMac ("just plug and play") accounted for 7.1% of personal computer unit sales and 8.2% of revenue in November. The rest of the top-five best-selling computers last month behind the iMac were Compaq's (NYSE: CPQ) Presario 5150, Hewlett-Packard's (NYSE: HWP) Pavilion 6355 (the number one seller in the under-$1,000 market), the Presario 5170, and the Pavilion 6370Z, in that order. The average price for iMacs in November was $1,266, but retailers are selling the iMac for as low as $1,099.

Apple is expected to roll out a faster version of iMac early next year along with new versions of its PowerMacintosh G3 computers. According to The San Francisco Chronicle, Apple is working on a laptop version of the iMac called WebMate, which could also debut in the first half of next year. Consumers might get a sneak peek of WebMate at next month's MacWorld Expo trade show in San Francisco. For more on Apple, see the Fool's year-in-review look at the company.

News to Go

Alan Greenspan and friends, also known as the Federal Open Market Committee (FOMC), meet today, but analysts aren't expecting to get another interest rate cut for Christmas. The Federal Reserve has already lowered interest rates three times since late September, on September 29, October 15, and November 17.

What would the end of a quarter be without earnings warnings?

Case Corp. (NYSE: CSE) expects a nearly 60% drop in 1998 earnings per share, before charges, and even lower numbers for 1999. The farm equipment maker will cut about 3,400 jobs by the end of next year and take a fourth quarter charge of $130 million to $135 million.

Circuit maker Cypress Semiconductor (NYSE: CY) is forecasting a Q4 loss of around $0.04 a share, compared with analysts' mean estimate of earnings of $0.04.

Semiconductor equipment maker Align-Rite International (Nasdaq: MASK) anticipates fiscal Q3 EPS of $0.15 to $0.18, roughly half of analysts' expectations of $0.32.

Technology consulting firm Renaissance Worldwide (Nasdaq: REGI) expects break-even Q4 earnings, short of analysts' forecasts of a profit of $0.07 a share.

Encore Wire Corp. (Nasdaq: WIRE) says Q4 EPS will be "significantly" below the $0.37 the wire and cable products maker earned last year and lower than analysts' mean estimate of $0.19.

Juice maker Northland Cranberries (Nasdaq: CBRYA) sees lower-than-expected revenue and earnings for its fiscal Q1 (ended November 30) and full-year fiscal 1999 (ending August 31). The company expects Q1 EPS to be flat with last year's $0.01, compared with analysts' projections of $0.06.

Calendar and organizer company Day Runner Inc. (Nasdaq: DAYR) anticipates fiscal Q2 EPS of $0.30 to $0.35, short of analysts' mean estimate of $0.55.

Hercules Inc. (NYSE: HPC) expects Q4 EPS of $0.28 to $0.33 (excluding charges) compared with analysts' forecasts of $0.47. The specialty chemicals maker will cut 700 jobs as it merges with Betzdearborn (NYSE: BTL).

Silicon Valley Bancshares (Nasdaq: SIVB), which makes loans to tech firms and life-sciences companies, anticipates Q4 EPS of $0.20 to $0.25, below analysts' expectations of $0.42.

Dental practice management company Monarch Dental Corp. (MDDS) is forecasting Q4 EPS of $0.06 to $0.12 (before charges), below analysts' mean estimate of $0.18.

Grocery warehouse retailer Smart & Final (NYSE: SMF) warns that Q4 earnings will be "significantly" below analysts' expectations, which were $0.17 a share.

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Yi-Hsin Chang (TMF Puck), Writer
Jennifer Silber (TMF Amused), Editor