Priceline.com drops on downgrade; AMD, Micron lead chip makers lower; Intel, Xilinx also hurt

By Evan Weinberger

New York, Dec. 17 - Priceline.com Inc. convertibles took a tumble on an analyst's downgrade Monday.

Excel Maritime Carriers, Ltd. also gave back some of its value on the day.

Weakness in Advanced Micro Devices Inc. and Micron Technology Inc. put the hurt on convertibles issued by Intel Corp. and Xilinx, Inc. EMC Corp. convertibles got caught in the tech vortex as well.

Activity was light as investors returned from the weekend in a foul mood. "Overall, things felt better for sale," one trader said. "Albeit [it was] quiet on the day."

Inflation fears drove down stocks Monday as wheat and rice prices hit all-time highs. And former Federal Reserve chairman Alan Greenspan said that the dreaded stagflation - rising inflation coupled with a weakening economy - may be sneaking its way back into the economy.

The Dow Jones Industrial Average gave back 172.65 points, or 1.29%, to close at 13,167.20.

The Nasdaq slumped 61.28 points, or 2.32%, for a 2,574.46 close as semiconductor makers and other tech stocks were taken to the woodshed.

And the S&P 500 closed at 1,445.90, a drop of 22.05 points, or 1.50%, on the day.

No new issues were announced before or after the trading day Monday, and market watchers said they were not expecting much in the run-up to Christmas next week. "Could you see something come this week?" one analyst asked. "It's possible. I'm not aware of anything. But it also could be over already. We're in the second-half of December."

Priceline downgraded, convertibles drop

Norwalk, Conn.-based online travel agency Priceline.com saw its convertibles and stock tumble after a Citigroup analyst downgraded the company to "Hold" on Monday.

The analyst, Mark S. Mahaney, had the stock at "Buy." He wrote in a note to clients that Priceline.com stock was within 5% of his $124 price target.

Priceline.com's 0.75% convertible senior notes due Sept. 30, 2013 closed Monday at 279.497 versus a closing stock price of $109.31. They closed Friday at 297.09 versus a stock price of $117.17.

Priceline.com stock (Nasdaq: PCLN) tumbled $7.86, or 6.71%, on the day.

Excel Maritime sinks

Athens, Greece-based dry bulk shipping firm Excel Maritime watched its 1.875% convertible senior notes due Oct. 15, 2027 sink to 84.558 versus a closing stock price of $41.96. They closed Friday at 91.032 versus a stock price of $48.20.

Excel Maritime stock (NYSE: EXM) plunged $6.24, or 12.95%, on Monday.

AMD, Micron down

Sunnyvale, Calif.-based Advanced Micro Devices (NYSE: AMD) tumbled again Monday as production delays continued to hamper the rollout of its new microchips.

In a conference call Thursday, AMD leadership vowed to return to profitability by the second half of 2008. Investors don't appear to be buying that story.

AMD's 5.75% convertible senior notes due Aug. 15, 2012 closed Monday at 82.355 versus a closing stock price of $7.95. They closed Friday at 84.045 versus a stock price of $8.43.

AMD's 5.75% convertible senior notes due Aug. 15, 2012 closed Monday at 72.31 versus a stock price of $7.95 after finishing Friday at 74.29 versus a stock price of $8.43.

AMD stock tumbled 48 cents, or 5.69%, on Monday.

Boise, Idaho-based Micron Technology also took a dive after reports of low prices for new chips seeped out Monday.

Micron's 1.875% convertible senior notes due June 1, 2014 closed Monday at 83.2517 versus a closing stock price of $7.89. They closed Friday at 85.897 versus a stock price of $8.37.

Stock in Micron (NYSE: MU) took a 48 cent, or 5.73%, hit Monday.

Intel, Xilinx caught in crossfire

Santa Clara, Calif.-based Intel, the market leader in semiconductors, hasn't been immune to the problems in the industry.

Intel's 2.95% junior subordinated convertible notes due Dec. 15, 2035 closed Monday at 105.71 versus a stock price of $25.72. They closed Friday at 106.975 versus a stock price of $26.29.

Intel stock (Nasdaq: INTC) fell 57 cents, or 2.17%, on the day.

San Jose, Calif.-based programmable logic device maker Xilinx was also hit Monday.

The company's 3.125% convertible junior subordinated debentures due March 15, 2037 closed Monday at 85.907 versus a closing stock price of $21.63. They closed Friday at 87.047 versus a stock price of $22.11

Xilinx stock (Nasdaq: XLNX) got crunched with what appeared to be the day's unlucky number, a 48 cent, or 2.17%, loss.

EMC caught in storm

Hopkinton, Mass.-based data storage producer EMC also tumbled Monday as the wider tech sector took a broadside.

EMC's 1.75% convertible senior notes due Dec. 1, 2011 closed Monday at 135.64 versus a closing stock price of $18.54. They closed Friday at 138.1 versus a stock price of $18.98.

EMC's 1.75% convertible senior notes due Dec. 1, 2013 closed Monday at 135.936 versus a stock price of $18.54 after finishing Friday at 139.59 versus a stock price of $18.98.

EMC stock (NYSE: EMC) fell 44 cents, or 2.32%, on the day.

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