Thursday, July 29, 1999

"You must learn from the mistakes of others. You can't possibly live long enough to make them all yourself."

-- Sam Levenson    

Latest Market Numbers

AT&T Posts Lower Q2 EPS

Telecommunications giant AT&T (NYSE: T) this morning reported second-quarter earnings from operations of $0.49 a share, down from $0.54 a year ago ahead of analysts' mean estimate of $0.48. Revenues, including TCI and the IBM Global Network business (now AT&T Global Network Services), increased 6.7% to $15.82 billion from $14.83 billion.

This was AT&T's sixth consecutive quarter of revenue growth. CEO Michael Armstrong said the "strong" quarterly earnings reflect "steady progress in executing our strategy." Two of the company's businesses, AT&T Wireless and AT&T Solutions, grew revenues by more than 40% each.

A replay of a conference call with analysts will be available starting today at 11 a.m. Eastern time until midnight Saturday. To listen, U.S. callers should dial (800) 475-6701 and enter access code 461985. Callers from outside the U.S. should try (320) 365-3844 and the same access code. The replay will also be available on the AT&T website (www.att.com/ir/).

News to Go

Compaq Computer (NYSE: CPQ) turned in a second-quarter loss of $0.10 a share, compared with analysts' reduced consensus forecast of a loss of $0.11. Last month, the company warned that it expected its Q2 to be negatively affected by "pricing pressures in the PC segment, inadequate revenue growth and a non-competitive cost structure." Compaq said it anticipates taking a $700 million to $900 million charge in Q3 for a massive restructuring that includes cutting 6,000 to 8,000 jobs.

Financial services giant Citigroup's (NYSE: C) co-chairmen Sanford Weill and John Reed will divide up responsibilities instead of jointly running the whole company, The Wall Street Journal reported. Weill, the former chairman of Travelers Group, will oversee the company's operating businesses and financial functions. Reed, formerly head of Citicorp, will be responsible for the Internet, technology, human resources, and legal issues.

Golf equipment maker Callaway Golf (NYSE: ELY) reported Q2 EPS of $0.35, up from $0.30 last year and just ahead of analysts' mean estimate of $0.34. But the company cautioned that the second half of the year will "continue to present challenges" for the company, as it faces continued startup costs relating to its new golf ball operations and costs of shifting its Japanese distribution to its wholly owned Japanese subsidiary. "We believe our sales and earnings will be negatively affected toward the end of the year."

Waste Management (NYSE: WMI) dumped yet another load of bad news on investors. It now expects Q2 EPS of $0.58 to $0.60, significantly lower than its July 6 warning of EPS that would come in between $0.67 and $0.70, before charges. The company plans to formally report results on August 3.

More Foolishness

Cramer vs. Cramer: Check out this week's Dueling Fools on thestreet.com... David Gardner critiques The New York Times' "insight" into investing in the '90s and gives some Foolish advice... Jeff Fischer celebrates the Drip Portfolio's two-year anniversary with a look back.

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