If the penny-a-share profit reported by Manugistics Inc. on Tuesday was supposed to be a spark that keeps the company's stock on a long-awaited climb, it misfired.

The reported consensus of Wall Street analysts had been that the company would report a loss of 3 cents per share. But in recent weeks, analysts had concluded that the company would do better than that and would turn a small profit.

That expectation drove the strock up roughly 50 percent in the past 10 days, to its highest point in January.

The company did report a profit Tuesday, but investors were not impressed with the "quality" of its earnings, said analyst Christopher Desautelle of Legg Mason Wood Walker Inc. Yesterday, the stock gave up a lot of gains, falling from $15.31 1/4 to $12.62 1/2 on the Nasdaq Stock Market.

Short-term traders apparently decided to take their profits rather than hope the stock would keep moving up.

"I think its very positive that they were able to show positive earnings, but when you really look into the numbers, they still had an operating loss," he said. The profits came only as the result of interest income--which was down sharply from a year earlier because the firm has spent much of its cash reserve--and tax benefits produced by previous losses.

The biggest disappointment was the decline in income from the licensing fees the company collects when it sells its software to corporate customers, said Desautelle, who rates the stock "market perform." At Legg Mason that rating is equivalent to "hold" and means it's not time to start buying the stock just yet.

Over the long term, however, the Legg Mason analyst is very positive about Manugistics' Internet initiative. The firm's new president, Gregory Owens, has been on the road giving investors the pitch on how Manugistics will cash in on the Net.

Manugistics' speciality is "supply-chain software." It makes customized systems that help corporations manage their stocks of raw materials and finished products. Now Manugistics intends to extend its reach "outside the building" by linking electronic commerce software to its internal systems.

CAPTION: Manugistics (This chart was not available)