Technology stocks posted solid gains Friday, as Apple Inc., LinkedIn Corp. and AOL Inc. fueled positive sentiment that drove most of the sector higher heading into the weekend.
The Nasdaq Composite (US:COMP) gained 29 points, or nearly 1%, to close at 3,194. The benchmark ended the week with a 0.5% gain.
The Philadelphia Semiconductor Index (US:SOX) rose 1.3% and the Morgan Stanley High-Tech Index (US:MSH) edged up about 0.7%.
Apple (US:AAPL) traded up 1.4% to close at $474.98. Analysts are speculating that the company may consider returning more cash to shareholders following its statement Thursday that was given in response to a lawsuit by hedge-fund manager David Einhorn.
The company has maintained that it is sticking by its proposed amendment on its proxy statement to eliminate the ability to issue so-called “blank check” preferred stock without shareholder approval.
LinkedIn (US:LNKD) shares jumped 21% to close at $150.48 — putting the stock at a new high and nearly double its market value at this time last year. The professional social network blew past Wall Street’s targets for the fourth quarter and issued a forecast that was also above analysts’ estimates. See: LinkedIn crushes targets; shares jump
Gene Munster of Piper Jaffray lifted his price target on the stock to $176 from $150, writing in a note that the company “is still in the relatively early stages of fully monetizing its professional network asset and that the company has the path to continue to grow in the mid-double-digit range for at least the next three years.”
AOL (US:AOL) shares rose 7.4% to close at $33.72 after the company reported a 57% jump in net income for the fourth quarter, with revenues above analysts’ forecasts.
Videogame publisher Activision Blizzard (US:ATVI) jumped 11% to close at $13.41 following its own better-than-expected results. Analysts from Macquarie Capital and Sterne Agee upgraded the stock to the equivalent of buy ratings. See: Activision hits big ahead of challenging year
“With the initial 2013 guidance now official, continued strength in core franchises, a solid pipeline of new IP, and the increased likelihood of a more shareholder-friendly capital structure, the next catalysts for Activision are likely positive, in our view,” wrote Ben Schachter of Macquarie in a note to clients.
One notable decliner was Riverbed Technology (US:RVBD) , down nearly 18% to close at $16.56 after reporting a sharp drop in profit and disappointing outlook. Daniel Ives of FBR Capital downgraded the stock to a market perform rating following the results.
“While we had some concerns initially around the OPNET acquisition (October 2012), it appears Riverbed has an even tougher road ahead than we previously thought due to integration issues related to the acquisition, coupled with headwinds on its core WAN optimization business,” he wrote.
Coinstar (US:CSTR) , the owner of the Redbox DVD kiosk business, shed 7% to close at $48.47 after the company reported a decline in earnings and an outlook below expectations. The company said its Redbox service is getting fewer new-release DVDs in the first part of the current quarter.
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