Bank technology stocks were mixed last week amid negative business forecasts for several key companies.
For example, Gary Helmig, analyst at Soundview Financial Group, Stamford, Conn., reduced his estimate of Electronic Data Systems Corp.'s fiscal 1997 earnings to $2.31 per share from $2.40.
The Plano, Tex., company is the largest vendor of bank technology services.
After discussions with EDS and competitors, such as Computer Sciences Corp. and International Business Machines Corp., Mr. Helmig said, he determined that the latter are in better position to sign up new business.
Mr. Helmig changed his investment rating of EDS to a short-term "hold" from short-term "buy."
"The next couple of quarters are going to be a little tougher than people think" for EDS, Mr. Helmig said. Computer Sciences, in particular, "is going to report large bookings this quarter," he said.
Mr. Helmig maintained a long-term "buy" rating on EDS because the company's management will "do the right things." "It still is an excellent core investment," he said.
EDS' stock price lost 62.5 cents for the week, to close at $43.625.
Other stocks also were affected by negative forecasts.
For instance, Cybercash Inc. stock fell $4.50 Friday after analyst Steven Birer of Hambrecht & Quist in San Francisco cut his rating to "hold" from "buy."
Mr. Birer said he had concluded that the Reston, Va., company would fall short of its $25 million revenue goal for fiscal year 1997.
Cybercash's initial public offering a year ago was led by Hambrecht & Quist. The company makes electronic commerce technology.
In the first nine months of 1996, Cybercash lost $18.5 million on revenue of $76,793. Its stock price dropped $5.625 last week, to close at $18.75.
In the broader market, stocks were mixed but ended on an upswing Friday. The Dow Jones industrial average closed at 6,544.09, down 16.8 points for the week.
The Nasdaq composite index, considered a good indicator of the fortunes of technology companies, ended the week up 19.38 points, at 1,310.78.
Goldman, Sachs & Co.'s index of U.S.-traded technology firms, which lists many bank technology stocks, edged up 0.75 point for the week, to 119.39.
In other news affecting bank technology firms, Deluxe Corp., St. Paul, said it would take a $140 million to $150 million pretax charge in the fourth quarter to offset gains from the planned sale of noncore business units.
The units being sold make business forms, greeting cards, and wrapping paper. Deluxe's main business lines are check printing and electronic data processing.
Deluxe executives said the company expects to meet its 1997 earnings forecast of $2.15 per share. The company's stock gained 62.5 cents last week, to close at $32.75