Robertson Stephens Daily Growth Stock Update on EWBX, COF, CTLM, INTC, LLTC, IWOV, PKSI, RNWK, VGIN, ALGN, LLY, GENZ, GDT, MAR and SGP

Apr 18, 2001, 01:00 ET from Robertson Stephens, Inc.

    SAN FRANCISCO, April 18 /PRNewswire/ -- The following has been issued by
 Robertson Stephens:
 
     Ratings Changes:
 
     EarthWeb Inc.
     (Nasdaq:   EWBX) $3.50
     Downgrading to Long-Term Attractive from Buy
     2001E EPS: ($0.09), up from ($0.42)
 
     Steven Birer, eServices
     "EarthWeb reported Q1:01 revenues of $17.1 million, 2.4% above our $16.7
 million estimate," said Birer. "This represents an increase of 117.1% compared
 to Q1:00 pro forma results and 5.2% versus Q4:00 pro forma results. Excluding
 a one-time charge of $270,000, the company reported Q1:01 cash EPS of $0.04,
 well above our estimate and Street consensus of a loss of $0.11 per share.
 While EarthWeb is positioning itself to capitalize on its newly focused
 business model, we believe that the near-term macroeconomic environment
 remains very uncertain and could hinder the company's efforts to garner and
 retain member companies, gain traction in its enterprise customer business,
 and generate positive cash flow. We do remain positive on the long-term
 fundamentals of the eRecruitment industry, the dice.com brand, and the
 company's focus on the high-tech job market. The near-term outlook, however,
 contains few catalysts. Accordingly, we are lowering our rating to Long-Term
 Attractive from Buy. We are lowering our revenue estimate for 2001 from $71.0
 million to $66.9 million. We are also adjusting our 2001 cash EPS estimate
 from a loss of 42 cents to a loss of 9 cents, as the company continues to
 focus on conserving cash and streamlining operating expenses relative to last
 year."
 
     Estimate Changes:
 
     Capital One Financial Corporation
     (NYSE:   COF) $58.40
     Buy
     2002E EPS: $3.55, New
 
     Jordan Hymowitz, eCredit & Lending/I-Auto
     "Capital One reported 1Q01 EPS of $0.66 per share, $0.02 above our
 estimate and in line with Street consensus," said Hymowitz. "We are
 maintaining our 2001 EPS estimate at $2.91 per share, and initiating our 2002
 EPS estimate at $3.55 per share -- reflecting 22% year over year EPS growth.
 Strong accounts and receivable growth in 1Q01 should enable the company to
 have solid earnings power in the second half of 2001.  COF's quarter was
 highlighted by 2.5 million net new accounts due to the company's use of teaser
 rates to spur account growth.  The new account growth resulted in managed
 loans growing 55% year over year.  Credit quality was stable in the quarter.
 COF's managed chargeoffs fell 12 bps to 3.75% from the year-ago period and 23
 bps sequentially from 4Q00, yet the credit performance was masked by the
 explosive portfolio growth.  Two quarters-ago lagged chargeoffs, a more
 meaningfully metric with a growing loan portfolio, increased 67 bps year over
 year to 4.97% -- yet fell 5 bps sequentially from 4Q00.  Capital One now has
 the lowest chargeoff rate of any public credit card company.  Capital One
 continued to trade near-term profitability for loan growth.  As a result of
 new accounts added at teaser rates, Capital One's ROMA fell to 1.63%.  We are
 more concerned with the company's adjusted ROMA, which fell to 1.05% -- its
 lowest level in more than two years. We continue to rate Capital One Buy."
 
     Centillium Communications, Inc.
     (Nasdaq:   CTLM) $32.09
     Long-Term Attractive
     2001E EPS: $0.27, up from ($0.01)
     2002E EPS: $0.56, up from $0.33
 
     Arun Veerappan, Communications Components/Semiconductor Devices
     "On April 17, Centillium announced Q1:01 results, with revenue of $31.9
 million and EPS from continuing operations of $0.01, beating both our top-line
 estimate of $30.0 million and our bottom-line estimate of ($0.03)," said
 Veerappan. "We would also note that the company delivered its first positive
 EPS result from continuing operations, which was ahead of plan. As expected,
 Centillium experienced strong demand from its Japanese customers, where it has
 close to 100% market share; this demand helped the company power through
 estimates. Going forward, the company's source of strength -- its strong
 position in Japan is also its biggest source of risk because competitors are
 aggressively seeking to gain entry into the market by using price as leverage.
 It will be Centillium's task to turn on its North American DSL revenue stream
 and its Entropia VoP revenue stream to pick up the slack should this occur. We
 commend Centillium and its management on its execution to date, particularly
 in Japan, where the company has successfully leveraged early work and existing
 relationships to corner that part of the DSL market.  Because of those
 efforts, the visibility that the company has into the June quarter leaves it
 in a unique position in the industry today and doubtless investors will find
 comfort from this, in our view."
 
     Intel Corporation
     (Nasdaq:   INTC) $26.25
     Long-Term Attractive
     2001E EPS: $0.52, down from $0.59
     2002E EPS: $0.70, down from $0.73
 
     Eric Rothdeutsch, Semiconductors/Computer Hardware
     "Intel reported 1Q01 revenues of $6.7 billion, down 23% QoQ, ahead of our
 $6.5 billion estimate and the company's pre-announcement guidance," said
 Rothdeutsch. "EPS was $0.16, beating both our and the consensus estimate by
 $0.01 due to higher-than-expected non-operating income. As a result of lower
 gross margins due to continued pressure on average selling prices and lower
 fab utilization rates, we are revising our F01 revenue and EPS estimates from
 $26.0 billion and $0.59 to $26.3 billion and $0.52, respectively. Our F02 EPS
 estimate is going from $0.73 to $0.71; our F02 revenue estimate is unchanged.
 In spite of what appears to be improving channel inventories, we remain
 cautious on Intel's near-term prospects given the rapid descent in gross
 margins, the steep and accelerating Pentium 4 price declines, the lack of a
 synchronous DRAM-compatible chipset, and a challenging 0.13 micron copper-
 interconnect process ramp confronting the company."
 
     Linear Technology Corporation
     (Nasdaq:   LLTC) $38.69
     Long-Term Attractive
     F2001E EPS: UR, from $1.32
     F2002E EPS: UR, from $1.34
 
     Tore Svanberg, Analog & Mixed-Signal Semiconductor Devices
     "Linear reported March quarter results yesterday," said Svanberg. "Revenue
 grew 9.1% sequentially to $282.0 million, $8.0 million better than our
 estimate. Gross margin expanded 54bps sequentially to 76.9%.  Expenses were
 $54.0 million, $1.2 million below our expectations.  As a result, EPS came in
 it at $0.38, three pennies better than our estimate and two pennies above
 Street consensus estimate. In terms of the outlook, Linear indicated that it
 has seen a dramatic decline in bookings and an increase in cancellations
 across all business segments. We believe that Linear's customers face high
 inventory levels and weak end market demand.  As such, the company has guided
 for a 20% to 30% sequential decline in revenue and earnings for the Q4:F01
 June quarter."
 
     Interwoven, Inc.
     (Nasdaq:   IWOV) $11.37
     Buy
     2001E EPS: $0.08, down from $0.12
     2002E EPS: $0.23, down from $0.28
 
     Alex Baluta, Internet & eCommerce Applications
     "Interwoven reported Q1:01 results yesterday that demonstrated its
 strength relative to its software peers," said Baluta. "The company reported
 revenues of $60.5 million, up 11% sequentially, and an operating EPS of $0.02,
 vs. our published estimates of $58.4 million in revenue and an operating EPS
 of $0.02. We believe that Interwoven's ability to post results that beat
 expectations when nearly all other eBusiness software companies have pre-
 announced underscores its position as a franchise company in an increasingly
 critical and "enterprise wide" software segment. In our opinion, that the
 company only added 91 new customers in the quarter, compared to 147 in the
 prior quarter highlights the trouble the company, and the industry is having
 in generating new business in the current IT and economic environment.
 Towards the end of the quarter Interwoven experienced longer sales cycles,
 decreased deal size, and delayed deals.  We are reducing our CY01 revenue
 estimates by 8.5% to $244.7mn and cash EPS to $0.08.  We are reducing our CY02
 revenue estimates by 11% to $351.4mn and cash EPS of $0.23. Interwoven remains
 one of our favorite names for the long term, and we reiterate our Buy rating."
 
     Primus Knowledge Solutions, Inc.
     (Nasdaq:   PKSI) $3.03
     Long-Term Attractive
     2001E EPS: ($0.31), up from ($0.44)
     2002E EPS: $0.22, up from $0.19
 
     Andrew Savitz, Business-to-Business eCommerce
     "Primus reported Q1:01 results in line with pre-announced numbers," said
 Savitz. "Primus reported total revenue of $10.1MM and a cash EPS loss of
 ($0.18) -- versus our revised numbers on April 3, the date of the pre-
 announcement, of $10.0MM and a cash EPS loss of ($0.23). Primus attributed the
 miss to lengthening sales cycles and delayed purchasing decisions. We are
 making slight modifications to our recently revised Q2:01 estimates after the
 company's pre-announcement on April 3. Based on limited visibility over the
 next several quarters, we are maintaining our Long-Term Attractive rating.
 While we believe that CRM continues to be a customer spending priority, the
 following issues will continue to impact the stock over the near-term, in our
 opinion: 1) risk to our revised numbers, 2) economic slowdown, 3) limited cash
 balance; 4) greater competitive pressures; and 5) a history of operating
 losses.  However, we continue to believe that Primus offers a best-of-breed
 knowledgebase solution, a core component of any complete CRM solution."
 
     RealNetworks, Inc.
     (Nasdaq:   RNWK) $8.59
     Long-Term Attractive
     2001E EPS: $0.08, down from $0.09
     2002E EPS: $0.15, down from $0.19
 
     Lowell Singer, Next-Generation Internet eNablers
     "RealNetworks announced its Q1:01 in line with our expectation," said
 Singer. "We are lowering our revenue/EPS estimates for 2001 from $245.2
 million/$0.09 to $218.2 milion/$0.08. The visibility remains poor for the
 company and, in comparison with a quarter ago, has gotten worse. We are also
 lowering our projections for 2002, revenues/EPS from $309.3 million/$0.19 to
 $275 million/$0.15. The company is experiencing a softening in all geographic
 regions; license revenue softness is due to lengthening sales cycles, as
 streaming media infrastructure software purchases are being postponed; service
 revenues are being negatively impacted by weakness in the RBN business;
 advertising revenue remains affected by the difficult economic environment. We
 reiterate our LTA rating. Though the company delivered the expectations it set
 in the beginning of the quarter, we are concerned about the risk over the next
 several quarters. The company is currently trading at a 2000 P/E ratio of
 102.6x and a 2001 P/E ratio of 57.3x; we find the company's stock fully
 valued."
 
     Visible Genetics Inc.
     (Nasdaq:   VGIN) $16.25
     Buy
     F2001E EPS: ($2.09), down from ($1.83)
     F2002E EPS: ($0.44), down from ($0.11)
 
     Michael King, Biopharmaceuticals
     "We expect VGI to hear a response from the FDA by the end of next week,
 precisely 90 days from the company's re-submission of the TruGene HIV-1 assay
 510(k) application of late January," said King. "At that point, the FDA could
 1.) take more time to review the 510(k) application, 2.) come back to VGI with
 more questions regarding the submission or 3.) reject the 510(k) application
 based on no substantially equivalent (NSE) device. While all three of these
 options sound bad, we believe the most likely course of action will be that
 the FDA will find no substantially equivalent device. This series of events
 was previously negotiated between VGI and the agency, and has been our
 understanding from the beginning. VGI will in turn immediately appeal the
 rejection under the 1997 Food and Drug Administration Modernization Act, after
 which the FDA will have 60 days to respond to the appeal. As a result, we are
 revising our official approval expectation of the TruGene HIV-1 assay to July.
 To reflect this revised approval timeline, we are taking the opportunity to
 lower our product sales forecast and EPS estimates going forward. We reiterate
 our BUY rating on Visible Genetics."
 
     Comments:
 
     Align Technology, Inc.
     (Nasdaq:   ALGN) $5.45
     Buy
 
     Wade King, Medical Technologies
     "Align Technology is scheduled to report its Q1'01 results before the
 market opens on Thursday, 4/26," said King. "We believe the company will
 report a strong first quarter, at least matching our expectations. Currently,
 Align is trading at 5.5x our 2001 revenue estimate of $45.4MM and at only 1.9x
 our 2002 revenue estimate of $134MM. We believe that Align offers investors a
 compelling investment opportunity in a revolutionary new technology for
 straightening teeth. Our price target for shares of Align is $16, based on 30x
 our 2003 EPS estimate of $0.63, discounted for risk and time. This presents
 investors with the opportunity for well over 100% ROI. We reiterate our Buy
 rating on shares of Align Technology and advise investors to buy the shares
 aggressively at current prices."
 
     Eli Lilly and Company
     (NYSE:   LLY) $80.50
     Buy
 
     Robert Hazlett, Large Capitalization/Specialty Pharmaceuticals
     "Lilly will present phase III data for its depression drug duloxetine at
 the American Psychiatric Association annual meeting in New Orleans, LA May 5-
 10," said Hazlett. "Duloxetine is currently in phase III development for the
 treatment of depression and urinary incontinence. We believe that important
 data differentiating duloxetine from currently marketed depression therapies
 may be presented at the meeting.  In our opinion, APA will be an important
 meeting for Lilly, as it will also potentially present data for atomoxetine
 for attention-deficit/hyperactivity disorder and its combination
 Prozac/Zyprexa (OFC) for treatment-resistant depression. We reiterate our Buy
 rating on LLY shares based on the potential of the company's late-stage
 pipeline, which we view as the best in the industry.  The company has numerous
 upcoming pipeline events: besides FDA filing for duloxetine, Lilly will likely
 file Cialis for erectile dysfunction and atomoxetine by year-end.
 Additionally, we anticipate FDA approval of Zovant for sepsis and Forteo for
 osteoporosis in 2001."
 
     Genzyme Corporation
     (Nasdaq:   GENZ) $105.46
     Buy
 
     Michael King, Biopharmaceuticals
     "Genzyme General entered into a collaboration with DaVita, a leading
 providers of dialysis treatment, to increase availability of Renagel to
 DaVita's end stage renal disease (ESRD) patients," said King. "At present,
 DaVita has approximately 41,000 patient under care, of which an estimated 30%
 are currently prescribed Renagel. The goal of the collaboration is to double
 this penetration to 60% or almost 25,000 ESRD patients. In our view, Renagel
 is the growth driver at Genzyme and continues to set record scrip levels with
 total scrips of 8,917 this week, representing weekly growth of 8.9%. We expect
 Genzyme to report 1Q:01 results this Thursday (4/19) and hold a conference
 call at 11AM EDT. We are looking for Renagel sales of $28.1 million in the
 quarter and $124 million for the year. In addition, we expect the company to
 report total 1Q:01 revenues of $170.6 million and EPS of $0.49 in the quarter.
 We reiterate our Buy rating on Genzyme General."
 
     Guidant Corporation
     (NYSE:   GDT) $43.58
     Long-Term Attractive
 
     Wade King, Medical Technologies
     "Guidant is scheduled to release its full Q1'01 results on Monday, 4/23,
 after the market close," said King. "Guidant released its preliminary Q1'01
 results last week. The company announced revenues of $471M and EPS of $0.41.
 Revenues were slightly higher than our prior projections and in line with our
 EPS projection. Results exclude a one-time charge associated with the ANCURE
 production halt. The company announced that this charge would be less than the
 previously estimated $12-$15M. We believe that Guidant has a strong product
 portfolio, but we remain cautious on near-term growth prospects within the
 highly competitive stent market. Our rating on the shares of Guidant is LTA."
 
     Marriott International, Inc.
     (NYSE:   MAR) $41.25
     Long-Term Attractive
 
     Harry Curtis, Gaming & Lodging
     "This note provides more detailed analysis of Marriott's 1Q:01 EPS of
 $0.47," said Curtis. "We estimate timeshare sales, the gain on sale mortgage
 notes, lower interest expense, and the reversal of an insurance reserve helped
 the quarter meaningfully. We maintain our Long-Term Attractive rating on
 shares of Marriott, as we believe the company's growth rate is already
 reflected in its trading premium to the lodging group. Shares of Marriott
 currently trade at 19.9x our revised 2001 EPS estimate and 11.3x our 2001
 EBITDA estimate versus the lodging group median of 13.4x forward P/E estimates
 and 7.4x 2001 EBITDA estimates. Given Marriott's business, we believe a higher
 multiple is warranted; however, we believe there is a higher risk of multiple
 contraction if estimates decline."
 
     Schering-Plough Corporation
     (NYSE:   SGP) $36.48
     Market Performer
 
     Robert Hazlett, Large Capitalization/Specialty Pharmaceuticals
     "Schering-Plough reported 1Q01 EPS of $0.38, down 10% from 1Q00 and two
 cents ahead of estimates," said Hazlett. "Despite these results, we are
 maintaining our full-year 2001 EPS estimate of $1.70 and are reducing 3Q by
 $0.02.  It should be noted that the potential for negative revisions to our
 full-year 2001 EPS estimates remain due to the possibility of extended
 manufacturing problems for the company. While this quarter's results gives us
 a better sense of which product lines have been affected by Schering's
 manufacturing issues, we still await a development regarding resolution
 timing.  Without further clarity on this issue, and competition on the horizon
 for pipeline products Clarinex (desloratadine) and PEG-Intron/PEG-Rebetron, we
 continue to rate SGP shares Market Performer."
 
     Industry Updates:
 
     Gaming and Lodging
 
     Harry Curtis, Gaming & Lodging
     "Louisiana's 13 casinos posted a 17.6% increase in March gaming revenue to
 $177 million from $151 million a year ago," said Curtis. "For the quarter,
 gaming revenues increased 12.6% to $485 million. Harrah's land-based casino in
 New Orleans posted an 8.9% increase in win to $22.3 million. Excluding this
 casino, riverboat gaming win increased 19% to $155 million in March, and grew
 14% for the quarter. We expect sequential improvement of at least 10% in
 gaming win as riverboats benefit from dockside legislation, which began April
 1 2001. Riverboats in Louisiana no longer are required to cruise, although the
 gaming tax rate increased 3 points to 21.5%. In Bossier, casinos have been
 dockside since inception, so will not benefit from these changes."
 
     Semiconductor Equipment & Foundries
 
     Sue Billat, Semiconductor Equipment/Foundries
     "Three pieces of news that came out this week reaffirmed our belief that
 this downturn is logic rather than DRAM driven and, while steep, should be
 shorter lived relative to the DRAM driven downturns of the 1990s," said
 Billat. "We are pleased to see Intel's capital budget unchanged for the year
 from the company's prior announcement. Intel also noted on its conference call
 yesterday that the P4 chip is already enjoying high yields. Therefore, we
 believe that spending will scale with an increase in output since yield
 improvement is already fully tapped. We believe this is incrementally positive
 for the capital equipment industry. We believe that unlike DRAMs, many logic
 devices are not interchangeable with each other or with future generation
 chips. As semiconductor processing technology moves forward, some logic chips
 become obsolete. Accordingly, we expect many logic manufacturers or their
 customers to scrap inventory rather than hold it for an extended period. In
 our view, Cisco taking a large inventory write-off charge is a case in point.
 We believe these measures will shorten the length of the downturn and benefit
 equipment makers, particularly those that provide processing technology such
 as the transition from aluminum to copper interconnect. In line with our
 expectations which we believe is more optimistic than most, Taiwan
 Semiconductor announced that it believes the trough of the current downturn
 should be in April or May, only slightly later than its previous expectation
 of a March/April timeframe. We believe that design activities by logic
 chipmakers will start to drive up the foundry's utilization rates, which we
 expect to trough around 50%. As a summary, we believe that while the current
 downturn is likely to last for some time to come, the news from Intel, Cisco,
 and TSMC are early indications that the downturn could be shorter lived than
 expected."
 
     Unless otherwise noted, prices are as of Tuesday, April 17, 2001.
 
     Robertson Stephens maintains a market in the shares of Cisco Systems,
 EarthWeb, Centillium, Intel, Linear Technology Corp., Interwoven, Primus
 Knowledge Solutions, RealNetworks, Visible Genetics, Align Technology and
 Genzyme, and has been a managing or comanaging underwriter for or has
 privately placed securities of Earthweb, Centillium, Interwoven, Primus
 Knowledge Solutions, RealNetworks, Visible Genetics, Align Technology and
 Taiwan Semiconductor within the past three years.
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SOURCE Robertson Stephens, Inc.
    SAN FRANCISCO, April 18 /PRNewswire/ -- The following has been issued by
 Robertson Stephens:
 
     Ratings Changes:
 
     EarthWeb Inc.
     (Nasdaq:   EWBX) $3.50
     Downgrading to Long-Term Attractive from Buy
     2001E EPS: ($0.09), up from ($0.42)
 
     Steven Birer, eServices
     "EarthWeb reported Q1:01 revenues of $17.1 million, 2.4% above our $16.7
 million estimate," said Birer. "This represents an increase of 117.1% compared
 to Q1:00 pro forma results and 5.2% versus Q4:00 pro forma results. Excluding
 a one-time charge of $270,000, the company reported Q1:01 cash EPS of $0.04,
 well above our estimate and Street consensus of a loss of $0.11 per share.
 While EarthWeb is positioning itself to capitalize on its newly focused
 business model, we believe that the near-term macroeconomic environment
 remains very uncertain and could hinder the company's efforts to garner and
 retain member companies, gain traction in its enterprise customer business,
 and generate positive cash flow. We do remain positive on the long-term
 fundamentals of the eRecruitment industry, the dice.com brand, and the
 company's focus on the high-tech job market. The near-term outlook, however,
 contains few catalysts. Accordingly, we are lowering our rating to Long-Term
 Attractive from Buy. We are lowering our revenue estimate for 2001 from $71.0
 million to $66.9 million. We are also adjusting our 2001 cash EPS estimate
 from a loss of 42 cents to a loss of 9 cents, as the company continues to
 focus on conserving cash and streamlining operating expenses relative to last
 year."
 
     Estimate Changes:
 
     Capital One Financial Corporation
     (NYSE:   COF) $58.40
     Buy
     2002E EPS: $3.55, New
 
     Jordan Hymowitz, eCredit & Lending/I-Auto
     "Capital One reported 1Q01 EPS of $0.66 per share, $0.02 above our
 estimate and in line with Street consensus," said Hymowitz. "We are
 maintaining our 2001 EPS estimate at $2.91 per share, and initiating our 2002
 EPS estimate at $3.55 per share -- reflecting 22% year over year EPS growth.
 Strong accounts and receivable growth in 1Q01 should enable the company to
 have solid earnings power in the second half of 2001.  COF's quarter was
 highlighted by 2.5 million net new accounts due to the company's use of teaser
 rates to spur account growth.  The new account growth resulted in managed
 loans growing 55% year over year.  Credit quality was stable in the quarter.
 COF's managed chargeoffs fell 12 bps to 3.75% from the year-ago period and 23
 bps sequentially from 4Q00, yet the credit performance was masked by the
 explosive portfolio growth.  Two quarters-ago lagged chargeoffs, a more
 meaningfully metric with a growing loan portfolio, increased 67 bps year over
 year to 4.97% -- yet fell 5 bps sequentially from 4Q00.  Capital One now has
 the lowest chargeoff rate of any public credit card company.  Capital One
 continued to trade near-term profitability for loan growth.  As a result of
 new accounts added at teaser rates, Capital One's ROMA fell to 1.63%.  We are
 more concerned with the company's adjusted ROMA, which fell to 1.05% -- its
 lowest level in more than two years. We continue to rate Capital One Buy."
 
     Centillium Communications, Inc.
     (Nasdaq:   CTLM) $32.09
     Long-Term Attractive
     2001E EPS: $0.27, up from ($0.01)
     2002E EPS: $0.56, up from $0.33
 
     Arun Veerappan, Communications Components/Semiconductor Devices
     "On April 17, Centillium announced Q1:01 results, with revenue of $31.9
 million and EPS from continuing operations of $0.01, beating both our top-line
 estimate of $30.0 million and our bottom-line estimate of ($0.03)," said
 Veerappan. "We would also note that the company delivered its first positive
 EPS result from continuing operations, which was ahead of plan. As expected,
 Centillium experienced strong demand from its Japanese customers, where it has
 close to 100% market share; this demand helped the company power through
 estimates. Going forward, the company's source of strength -- its strong
 position in Japan is also its biggest source of risk because competitors are
 aggressively seeking to gain entry into the market by using price as leverage.
 It will be Centillium's task to turn on its North American DSL revenue stream
 and its Entropia VoP revenue stream to pick up the slack should this occur. We
 commend Centillium and its management on its execution to date, particularly
 in Japan, where the company has successfully leveraged early work and existing
 relationships to corner that part of the DSL market.  Because of those
 efforts, the visibility that the company has into the June quarter leaves it
 in a unique position in the industry today and doubtless investors will find
 comfort from this, in our view."
 
     Intel Corporation
     (Nasdaq:   INTC) $26.25
     Long-Term Attractive
     2001E EPS: $0.52, down from $0.59
     2002E EPS: $0.70, down from $0.73
 
     Eric Rothdeutsch, Semiconductors/Computer Hardware
     "Intel reported 1Q01 revenues of $6.7 billion, down 23% QoQ, ahead of our
 $6.5 billion estimate and the company's pre-announcement guidance," said
 Rothdeutsch. "EPS was $0.16, beating both our and the consensus estimate by
 $0.01 due to higher-than-expected non-operating income. As a result of lower
 gross margins due to continued pressure on average selling prices and lower
 fab utilization rates, we are revising our F01 revenue and EPS estimates from
 $26.0 billion and $0.59 to $26.3 billion and $0.52, respectively. Our F02 EPS
 estimate is going from $0.73 to $0.71; our F02 revenue estimate is unchanged.
 In spite of what appears to be improving channel inventories, we remain
 cautious on Intel's near-term prospects given the rapid descent in gross
 margins, the steep and accelerating Pentium 4 price declines, the lack of a
 synchronous DRAM-compatible chipset, and a challenging 0.13 micron copper-
 interconnect process ramp confronting the company."
 
     Linear Technology Corporation
     (Nasdaq:   LLTC) $38.69
     Long-Term Attractive
     F2001E EPS: UR, from $1.32
     F2002E EPS: UR, from $1.34
 
     Tore Svanberg, Analog & Mixed-Signal Semiconductor Devices
     "Linear reported March quarter results yesterday," said Svanberg. "Revenue
 grew 9.1% sequentially to $282.0 million, $8.0 million better than our
 estimate. Gross margin expanded 54bps sequentially to 76.9%.  Expenses were
 $54.0 million, $1.2 million below our expectations.  As a result, EPS came in
 it at $0.38, three pennies better than our estimate and two pennies above
 Street consensus estimate. In terms of the outlook, Linear indicated that it
 has seen a dramatic decline in bookings and an increase in cancellations
 across all business segments. We believe that Linear's customers face high
 inventory levels and weak end market demand.  As such, the company has guided
 for a 20% to 30% sequential decline in revenue and earnings for the Q4:F01
 June quarter."
 
     Interwoven, Inc.
     (Nasdaq:   IWOV) $11.37
     Buy
     2001E EPS: $0.08, down from $0.12
     2002E EPS: $0.23, down from $0.28
 
     Alex Baluta, Internet & eCommerce Applications
     "Interwoven reported Q1:01 results yesterday that demonstrated its
 strength relative to its software peers," said Baluta. "The company reported
 revenues of $60.5 million, up 11% sequentially, and an operating EPS of $0.02,
 vs. our published estimates of $58.4 million in revenue and an operating EPS
 of $0.02. We believe that Interwoven's ability to post results that beat
 expectations when nearly all other eBusiness software companies have pre-
 announced underscores its position as a franchise company in an increasingly
 critical and "enterprise wide" software segment. In our opinion, that the
 company only added 91 new customers in the quarter, compared to 147 in the
 prior quarter highlights the trouble the company, and the industry is having
 in generating new business in the current IT and economic environment.
 Towards the end of the quarter Interwoven experienced longer sales cycles,
 decreased deal size, and delayed deals.  We are reducing our CY01 revenue
 estimates by 8.5% to $244.7mn and cash EPS to $0.08.  We are reducing our CY02
 revenue estimates by 11% to $351.4mn and cash EPS of $0.23. Interwoven remains
 one of our favorite names for the long term, and we reiterate our Buy rating."
 
     Primus Knowledge Solutions, Inc.
     (Nasdaq:   PKSI) $3.03
     Long-Term Attractive
     2001E EPS: ($0.31), up from ($0.44)
     2002E EPS: $0.22, up from $0.19
 
     Andrew Savitz, Business-to-Business eCommerce
     "Primus reported Q1:01 results in line with pre-announced numbers," said
 Savitz. "Primus reported total revenue of $10.1MM and a cash EPS loss of
 ($0.18) -- versus our revised numbers on April 3, the date of the pre-
 announcement, of $10.0MM and a cash EPS loss of ($0.23). Primus attributed the
 miss to lengthening sales cycles and delayed purchasing decisions. We are
 making slight modifications to our recently revised Q2:01 estimates after the
 company's pre-announcement on April 3. Based on limited visibility over the
 next several quarters, we are maintaining our Long-Term Attractive rating.
 While we believe that CRM continues to be a customer spending priority, the
 following issues will continue to impact the stock over the near-term, in our
 opinion: 1) risk to our revised numbers, 2) economic slowdown, 3) limited cash
 balance; 4) greater competitive pressures; and 5) a history of operating
 losses.  However, we continue to believe that Primus offers a best-of-breed
 knowledgebase solution, a core component of any complete CRM solution."
 
     RealNetworks, Inc.
     (Nasdaq:   RNWK) $8.59
     Long-Term Attractive
     2001E EPS: $0.08, down from $0.09
     2002E EPS: $0.15, down from $0.19
 
     Lowell Singer, Next-Generation Internet eNablers
     "RealNetworks announced its Q1:01 in line with our expectation," said
 Singer. "We are lowering our revenue/EPS estimates for 2001 from $245.2
 million/$0.09 to $218.2 milion/$0.08. The visibility remains poor for the
 company and, in comparison with a quarter ago, has gotten worse. We are also
 lowering our projections for 2002, revenues/EPS from $309.3 million/$0.19 to
 $275 million/$0.15. The company is experiencing a softening in all geographic
 regions; license revenue softness is due to lengthening sales cycles, as
 streaming media infrastructure software purchases are being postponed; service
 revenues are being negatively impacted by weakness in the RBN business;
 advertising revenue remains affected by the difficult economic environment. We
 reiterate our LTA rating. Though the company delivered the expectations it set
 in the beginning of the quarter, we are concerned about the risk over the next
 several quarters. The company is currently trading at a 2000 P/E ratio of
 102.6x and a 2001 P/E ratio of 57.3x; we find the company's stock fully
 valued."
 
     Visible Genetics Inc.
     (Nasdaq:   VGIN) $16.25
     Buy
     F2001E EPS: ($2.09), down from ($1.83)
     F2002E EPS: ($0.44), down from ($0.11)
 
     Michael King, Biopharmaceuticals
     "We expect VGI to hear a response from the FDA by the end of next week,
 precisely 90 days from the company's re-submission of the TruGene HIV-1 assay
 510(k) application of late January," said King. "At that point, the FDA could
 1.) take more time to review the 510(k) application, 2.) come back to VGI with
 more questions regarding the submission or 3.) reject the 510(k) application
 based on no substantially equivalent (NSE) device. While all three of these
 options sound bad, we believe the most likely course of action will be that
 the FDA will find no substantially equivalent device. This series of events
 was previously negotiated between VGI and the agency, and has been our
 understanding from the beginning. VGI will in turn immediately appeal the
 rejection under the 1997 Food and Drug Administration Modernization Act, after
 which the FDA will have 60 days to respond to the appeal. As a result, we are
 revising our official approval expectation of the TruGene HIV-1 assay to July.
 To reflect this revised approval timeline, we are taking the opportunity to
 lower our product sales forecast and EPS estimates going forward. We reiterate
 our BUY rating on Visible Genetics."
 
     Comments:
 
     Align Technology, Inc.
     (Nasdaq:   ALGN) $5.45
     Buy
 
     Wade King, Medical Technologies
     "Align Technology is scheduled to report its Q1'01 results before the
 market opens on Thursday, 4/26," said King. "We believe the company will
 report a strong first quarter, at least matching our expectations. Currently,
 Align is trading at 5.5x our 2001 revenue estimate of $45.4MM and at only 1.9x
 our 2002 revenue estimate of $134MM. We believe that Align offers investors a
 compelling investment opportunity in a revolutionary new technology for
 straightening teeth. Our price target for shares of Align is $16, based on 30x
 our 2003 EPS estimate of $0.63, discounted for risk and time. This presents
 investors with the opportunity for well over 100% ROI. We reiterate our Buy
 rating on shares of Align Technology and advise investors to buy the shares
 aggressively at current prices."
 
     Eli Lilly and Company
     (NYSE:   LLY) $80.50
     Buy
 
     Robert Hazlett, Large Capitalization/Specialty Pharmaceuticals
     "Lilly will present phase III data for its depression drug duloxetine at
 the American Psychiatric Association annual meeting in New Orleans, LA May 5-
 10," said Hazlett. "Duloxetine is currently in phase III development for the
 treatment of depression and urinary incontinence. We believe that important
 data differentiating duloxetine from currently marketed depression therapies
 may be presented at the meeting.  In our opinion, APA will be an important
 meeting for Lilly, as it will also potentially present data for atomoxetine
 for attention-deficit/hyperactivity disorder and its combination
 Prozac/Zyprexa (OFC) for treatment-resistant depression. We reiterate our Buy
 rating on LLY shares based on the potential of the company's late-stage
 pipeline, which we view as the best in the industry.  The company has numerous
 upcoming pipeline events: besides FDA filing for duloxetine, Lilly will likely
 file Cialis for erectile dysfunction and atomoxetine by year-end.
 Additionally, we anticipate FDA approval of Zovant for sepsis and Forteo for
 osteoporosis in 2001."
 
     Genzyme Corporation
     (Nasdaq:   GENZ) $105.46
     Buy
 
     Michael King, Biopharmaceuticals
     "Genzyme General entered into a collaboration with DaVita, a leading
 providers of dialysis treatment, to increase availability of Renagel to
 DaVita's end stage renal disease (ESRD) patients," said King. "At present,
 DaVita has approximately 41,000 patient under care, of which an estimated 30%
 are currently prescribed Renagel. The goal of the collaboration is to double
 this penetration to 60% or almost 25,000 ESRD patients. In our view, Renagel
 is the growth driver at Genzyme and continues to set record scrip levels with
 total scrips of 8,917 this week, representing weekly growth of 8.9%. We expect
 Genzyme to report 1Q:01 results this Thursday (4/19) and hold a conference
 call at 11AM EDT. We are looking for Renagel sales of $28.1 million in the
 quarter and $124 million for the year. In addition, we expect the company to
 report total 1Q:01 revenues of $170.6 million and EPS of $0.49 in the quarter.
 We reiterate our Buy rating on Genzyme General."
 
     Guidant Corporation
     (NYSE:   GDT) $43.58
     Long-Term Attractive
 
     Wade King, Medical Technologies
     "Guidant is scheduled to release its full Q1'01 results on Monday, 4/23,
 after the market close," said King. "Guidant released its preliminary Q1'01
 results last week. The company announced revenues of $471M and EPS of $0.41.
 Revenues were slightly higher than our prior projections and in line with our
 EPS projection. Results exclude a one-time charge associated with the ANCURE
 production halt. The company announced that this charge would be less than the
 previously estimated $12-$15M. We believe that Guidant has a strong product
 portfolio, but we remain cautious on near-term growth prospects within the
 highly competitive stent market. Our rating on the shares of Guidant is LTA."
 
     Marriott International, Inc.
     (NYSE:   MAR) $41.25
     Long-Term Attractive
 
     Harry Curtis, Gaming & Lodging
     "This note provides more detailed analysis of Marriott's 1Q:01 EPS of
 $0.47," said Curtis. "We estimate timeshare sales, the gain on sale mortgage
 notes, lower interest expense, and the reversal of an insurance reserve helped
 the quarter meaningfully. We maintain our Long-Term Attractive rating on
 shares of Marriott, as we believe the company's growth rate is already
 reflected in its trading premium to the lodging group. Shares of Marriott
 currently trade at 19.9x our revised 2001 EPS estimate and 11.3x our 2001
 EBITDA estimate versus the lodging group median of 13.4x forward P/E estimates
 and 7.4x 2001 EBITDA estimates. Given Marriott's business, we believe a higher
 multiple is warranted; however, we believe there is a higher risk of multiple
 contraction if estimates decline."
 
     Schering-Plough Corporation
     (NYSE:   SGP) $36.48
     Market Performer
 
     Robert Hazlett, Large Capitalization/Specialty Pharmaceuticals
     "Schering-Plough reported 1Q01 EPS of $0.38, down 10% from 1Q00 and two
 cents ahead of estimates," said Hazlett. "Despite these results, we are
 maintaining our full-year 2001 EPS estimate of $1.70 and are reducing 3Q by
 $0.02.  It should be noted that the potential for negative revisions to our
 full-year 2001 EPS estimates remain due to the possibility of extended
 manufacturing problems for the company. While this quarter's results gives us
 a better sense of which product lines have been affected by Schering's
 manufacturing issues, we still await a development regarding resolution
 timing.  Without further clarity on this issue, and competition on the horizon
 for pipeline products Clarinex (desloratadine) and PEG-Intron/PEG-Rebetron, we
 continue to rate SGP shares Market Performer."
 
     Industry Updates:
 
     Gaming and Lodging
 
     Harry Curtis, Gaming & Lodging
     "Louisiana's 13 casinos posted a 17.6% increase in March gaming revenue to
 $177 million from $151 million a year ago," said Curtis. "For the quarter,
 gaming revenues increased 12.6% to $485 million. Harrah's land-based casino in
 New Orleans posted an 8.9% increase in win to $22.3 million. Excluding this
 casino, riverboat gaming win increased 19% to $155 million in March, and grew
 14% for the quarter. We expect sequential improvement of at least 10% in
 gaming win as riverboats benefit from dockside legislation, which began April
 1 2001. Riverboats in Louisiana no longer are required to cruise, although the
 gaming tax rate increased 3 points to 21.5%. In Bossier, casinos have been
 dockside since inception, so will not benefit from these changes."
 
     Semiconductor Equipment & Foundries
 
     Sue Billat, Semiconductor Equipment/Foundries
     "Three pieces of news that came out this week reaffirmed our belief that
 this downturn is logic rather than DRAM driven and, while steep, should be
 shorter lived relative to the DRAM driven downturns of the 1990s," said
 Billat. "We are pleased to see Intel's capital budget unchanged for the year
 from the company's prior announcement. Intel also noted on its conference call
 yesterday that the P4 chip is already enjoying high yields. Therefore, we
 believe that spending will scale with an increase in output since yield
 improvement is already fully tapped. We believe this is incrementally positive
 for the capital equipment industry. We believe that unlike DRAMs, many logic
 devices are not interchangeable with each other or with future generation
 chips. As semiconductor processing technology moves forward, some logic chips
 become obsolete. Accordingly, we expect many logic manufacturers or their
 customers to scrap inventory rather than hold it for an extended period. In
 our view, Cisco taking a large inventory write-off charge is a case in point.
 We believe these measures will shorten the length of the downturn and benefit
 equipment makers, particularly those that provide processing technology such
 as the transition from aluminum to copper interconnect. In line with our
 expectations which we believe is more optimistic than most, Taiwan
 Semiconductor announced that it believes the trough of the current downturn
 should be in April or May, only slightly later than its previous expectation
 of a March/April timeframe. We believe that design activities by logic
 chipmakers will start to drive up the foundry's utilization rates, which we
 expect to trough around 50%. As a summary, we believe that while the current
 downturn is likely to last for some time to come, the news from Intel, Cisco,
 and TSMC are early indications that the downturn could be shorter lived than
 expected."
 
     Unless otherwise noted, prices are as of Tuesday, April 17, 2001.
 
     Robertson Stephens maintains a market in the shares of Cisco Systems,
 EarthWeb, Centillium, Intel, Linear Technology Corp., Interwoven, Primus
 Knowledge Solutions, RealNetworks, Visible Genetics, Align Technology and
 Genzyme, and has been a managing or comanaging underwriter for or has
 privately placed securities of Earthweb, Centillium, Interwoven, Primus
 Knowledge Solutions, RealNetworks, Visible Genetics, Align Technology and
 Taiwan Semiconductor within the past three years.
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