Financial technology stocks rose last week, buoyed along with the market by robust bank earnings reports and diminishing inflation fears.
Practically all the publicly traded companies with a significant share of business coming from financial institutions saw gains during the week, after many banks reported higher earnings and government statistics showed inflation mainly under control. The latter data reinforced investor opinion that interest rates won't rise again until November.
Dallas-based Banctec Inc. reported revenues of $73.2 million for its fiscal second quarter, which ended Sept. 25, compared with $53.3 million for the same period last year.
Net income for the banking hardware and software firm increased to $4.1 million or 36 cents per share, compared with $3.4 million, or 30 cents per share, in the second quarter of the prior year.
Banctec officials said the improvement in revenues was due primarily to acquisitions made in the second half of fiscal 1994, as well as to increased shipments of imaging products.
Overall gross margins improved from the prior year, due to a significantly increased percentage of software revenues, they added.
Grahame N. Clark Jr., Banctec's chairman and chief executive officer, said: "We continue to be pleased with the successful integration of the companies acquired during the past year. As a result of those acquisitions, Banctec is now able to focus on a variety of network-oriented products that will provide real opportunities for growth in the coming years."
Mr. Clark said Banctec had won major contracts with Sears Roebuck and Co., Signet Bank, and BMG Marketing for high-speed, check-imaging products.
Banctec also released an electronic benefits transfer software product, which is currently installed in a pilot program at a grocery chain.
Mr. Clark noted that Banctec expects slower earnings growth in the second half of this fiscal year due to rising interest rates and a weakening market for original-equipment manufacturing of reader/sorter products.
Banctec's stock closed Friday at $19.25 a share, down $5.25 for the week.
Automated teller machine maker Diebold Inc. reported a 31% improvement in its third-quarter earnings compared with the same 1993 period.
In the quarter ended Sept. 30, Canton, Ohio-based Diebold had net income of $16.7 million, or 55 cents per share, versus net income of $12.7 million, or 42 cents per share, for the same 1993 quarter.
"Performance in the third quarter was again satisfactory," said Robert W. Mahoney, Diebold's chairman, president, and chief executive officer.
"While incoming orders for the period were somewhat flat compared to a year ago," he said, "year-to-date orders are up compared to the previous nine months. Our backlog going into the fourth quarter remains healthy, up some 5% from the 1993 third quarter, and positions us well for the close of a strong year."
[Tabular Data Omitted]