ABI's rebuilding year

Earnings pressure surfaced at Applied Biosystems Group last year as sales of its flagship ABI Prism 3700 DNA Analyzer started to decline following completion of the sequencing of the human genome. The company now has a plan to stimulate its top line, but investors were unhappy when the company announced last week that it would address the drop-off in sales by ramping up R&D spending at the expense of earnings for 2002.

ABI shares fell $8.54 (25%) to $25.20 on Thursday following its after-market announcement on Wednesday that it expects EPS for fiscal 2002 to be $0.80-$0.90, below the $0.95 the Street had expected. The stock closed the week off $9.71 at $24.40 , lopping over $2 billion off ABI's market cap...