MARKET SHARE

By Bill LoomisThe integrators continued to bounce back from their lows, as first quarter earnings reports come in generally better than expected. The Washington Technology Composite index was up 4.8 percent during the second half of April, outpacing the Dow Jones' 2.7 percent gain and Nasdaq's 2.3 percent gain. Over the last two weeks, several integrators reported strong results, including Affiliated Computer Services Inc., Unisys Corp. and smaller integrators like Sapient Corp., Complete Business Solutions Inc. and IMRglobal Corp.Electronic Data Systems Corp. of Plano, Texas, reported lower earnings per share in the quarter, in line with analysts' estimates. EDS' shares climbed in anticipation of its new management's first meeting with analysts April 29. The meeting, held at the New York Stock Exchange, was well-attended. While the new management's message did not include anything unexpected, it was upbeat, with EDS chief executive Richard Brown expressing comfort with 1999 earnings per share estimates of $1.86.Among the best performers over the last two weeks was Keane Inc. of Boston. Keane's shares jumped 22 percent after its first quarter earnings report.Keane's shares had been declining over the last several months because of concerns about its ability to transition its year 2000 business (34 percent of total revenue in 1998) to other types of IT services. With Keane's management announcing first quarter results, and lowering earnings expectations for the year, investors figured the bad news was already priced into the shares and began bottom fishing. Government Technology Services Inc., the leading federal reseller, saw its shares jump 21 percent following its first quarter earnings report. The Chantilly, Va.-based company reported a per-share loss of 20 cents vs. 52 cents, narrowing its loss on 27 percent higher revenue.But IBM Corp. stole the headlines among technology investors over the last two weeks. IBM's shares had been drifting lower before its first quarter earnings release, as investors feared it would be disappointing. IBM reported earnings per share of $1.55 vs. $1.06 for the year-earlier period, well ahead of analysts' $1.41 estimate. IBM's shares soared from $171 to $215 in a couple of days, a new all-time high, on the strong performance and upbeat outlook. Nichols Research Corp.'s shares climbed 10 percent after an Internet com-pany, Healthgate.com, 15 percent owned by Nichols, filed for an initial public offering. Healthgate supplies medical information to health care professionals over the Internet. Titan Corp.'s shares declined the most over the last two weeks, down 18 percent, as investors took some profits following strong 25 percent gain in the previous two weeks.Shares of Affiliated Computer Services of Dallas declined 12 percent following its earnings release. First quarter earnings per share were 43 cents vs. 34 cents, a penny above analysts' estimates. The business outlook at ACS continues to be strong, with ACS Government Solutions (previously Computer Data Systems) reporting very strong performance and outlook. Bill Loomis is managing director of the Technology Research Group at Legg Mason Inc., Baltimore. He can be reached at wrloomis@leggmason.com. This information should not be construed as advice designed to meet the investment needs of any investor.