Most bank systems stocks were inundated by the wave of selling that swamped the technology sector last week, though higher quarterly earnings reports kept some firms' share prices from sinking.
After a six-month rally, investors suddenly became bearish on technology stocks last week, apparently spooked by price/earnings ratios that reached stratospheric levels.
Some financial technology firms, however, offset the pessimism by reporting second-quarter earnings that met or exceeded expectations.
Outsourcing giant Electronic Data Systems Corp. said its second-quarter earnings increased 15% from the same period in 1994.
Plano, Tex.-based EDS said that for the quarter ended June 30, net income rose to $226.9 million, or 47 cents a share, compared with $197.3 million, or 41 cents a share. The earnings met a Wall Street analysts' consensus estimate published by First Call Corp.
EDS officials said second-quarter revenues increased to $3.0 billion, from $2.3 billion in the second quarter of 1994.
Another big player in the bank systems outsourcing business was Little Rock-based Alltel Corp., which reported second-quarter earnings of $98.1 million, or 43 cents a share, compared with $76.2 million, or 40 cents per share. Alltel's earnings were also in line with analysts' forecasts, according to First Call.
Alltel officials said operating income from its information services division, formerly known as Systematics, were affected by a $3 million charge relating to layoffs of 200 employees announced last month. "Excluding this one-time charge, results from (the information services unit's) operations reflect a solid improvement over the first quarter," said Joe Ford, Alltel's chairman and chief executive officer.
Point of sale terminal systems manufacturer Verifone Inc. reported that second-quarter income reached $8.8 million, or 38 cents per share, up from $7.4 million, or 31 cents per share, in the corresponding period last year. Analysts had predicted Redwood City, Calif.-based Verifone would earn 36 cents in the quarter.
Banctec Inc., the Dallas-based supplier of community banking software and check processing equipment, reported net income for its first fiscal 1996 quarter, ended June 25, of $3.8 million, or 35 cents per share, compared to $3.7 million, or 33 cents per share, for the year-earlier period. Wall Street expected Banctec to report earnings of 27 cents per share in the latest quarter, according to First Call.
Portland, Ore.-based CFI ProServices Inc., a bank software developer, reported second-quarter net income of $786,000, 16 cents per common share, compared with $780,000, or 16 cents per share, for the same period in 1994.