U.S. stocks slid on Wednesday on a disappointing revenue outlook from Cisco Systems Inc., but blue chips limited losses as shares of Hewlett-Packard Co. surged following the ouster of Chief Executive Carly Fiorina.
Cisco fell 61 cents to $17.63 after the networking company's quarterly profits, announced after the bell Tuesday , matched expectations, but sales fell short. And investors weren't impressed with a cautious outlook for the current quarter.
Shares of HP soared 6.9 percent to close at $21.53 after the abrupt departure of Fiorina, who cited differences with the board over strategy as she tried to transform the company from a printer business to a technology giant. The board named Chief Financial Officer Robert P. Wayman interim CEO.
The Dow Jones Industrial Average fell 60.52, or 0.6 percent, to 10,664.11. The Standard & Poor's 500 Index declined 10.31, or 0.9 percent, to 1,191.99. The Nasdaq Composite Index slipped 34.13, or 1.6 percent, at 2,052.55.
Among local companies, shares of Sport Chalet Inc. jumped 9 percent to close at $14.80 after the La Canada-based sporting goods retailer posted positive earnings after Tuesday's closing bell. For the third quarter ended Dec. 31, the company reported net income of $3.8 million (53 cents per diluted share), compared with $3.1 million (44 cents) for the year-earlier quarter. Revenues rose 20 percent to $95.9 million from $79.7 million in the year-ago period.
DaVita Inc. saw its shares rise 2.5 percent on Wednesday to $42.58 after the El Segundo-based dialysis services provider released its fourth-quarter earnings. For the quarter ended Dec. 31, the company reported net income of $56.6 million (56 cents per diluted share), compared to $62.8 million (61 cents) in the like-period of 2003. DaVita estimated 2005 operating income to improve by from 2 percent to 6 percent over the 2004 operating income performance.
On the down side, Tarrant Apparel Group lost 6 percent to close at $2.04 after the L.A.-based private-label clothing provider lowered its revenue guidance for the fourth quarter and forecast a wider-than-expected quarterly loss, citing foreign currency charges, weak holiday bookings and higher air freight costs. Tarrant expects to report a fourth-quarter loss of $27 million to $27.5 million, on revenue of $36 million to $38 million.
Shares of El Segundo-based International Rectifier Corp. fell 2.8 percent to close at $41.26 on the same day its stock received new coverage by Global Crown Capital, with the rating set at "overweight."
For reprint and licensing requests for this article, CLICK HERE.