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STEC Short Squeeze Potential keeps building for next week.



October 28, 2009 – Comments (3) | RELATED TICKERS: STEC.DL , QTM

Can STEC Match Quantum's Leap? By the Staff On 11:54 am EDT, Wednesday October 28, 2009

San Jose, California-based Quantum Corporation (NYSE: QTM - News) more than doubled analysts' EPS estimates in its fiscal second quarter, sending shares up 20%. The company reported its second consecutive quarter of GAAP profits, which totaled $11 million or 6 cents a share. After adjustments, EPS came to 11 cents a share, crushing analysts' expectations of 4 cents.

Chairman and CEO Rick Belluzzo said, "Despite the continuing impact of the economic downturn and changes in the deduplication landscape, we delivered some of our best results in many years." He continued to highlight improved gross and operating margins.

As a whole, the Data Storage Index is off by -1.2% today, as much of the sector heads south.

Investors will be watching closely when solid-state drive player STEC (NASDAQ: STEC - News) reports its earnings after the bell on November 3. The company has struggled to recover after falling sharply in September. Needless to say it would take a very impressive report to climb back to its 52-week high, but with a massive 29% short interest as of October 15, a short squeeze could be possible.

Imation (NYSE: IMN - News) and Hutchinson Technology (NASDAQ: HTCH - News), two of Quantum's small-cap peers, have erased earlier gains to turn negative. Xyratex (NASDAQ: XRTX - News) is slipping by over -4%.

EMC (NYSE: EMC - News), Western Digital (NYSE: WDC - News), and Seagate Technology (NASDAQ: STX - News) are all trading lower since reporting their earnings last week. NetApp (NASDAQ: NTAP - News) has sold off with its large-cap peers, although it's latest earnings report in August sent the stock on a steady month-long upward trend.

As of this writing, the Data Storage Stocks Index is one of 100 worst-performing tickerspy Indexes over the last month, down by -5%.

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3 Comments – Post Your Own

#1) On October 28, 2009 at 12:47 PM, portefeuille (98.79) wrote:

I forgot to add an "outperform" call on QTM when it became "ratable" again. At least my list was there to help out in March, hehe ...


#371) On March 27, 2009 at 12:14 PM, portefeuille (99.97) wrote: QTM - 0.76 - outperform


(from here)

My favourite "storage stock" is EMC. EMC shares and call options are by far my largest positions.


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#2) On October 28, 2009 at 12:50 PM, portefeuille (98.79) wrote:

The all-time low for the price of QTM shares was at $0.09 (made on 11/24/08)!

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#3) On October 28, 2009 at 12:52 PM, portefeuille (98.79) wrote:

... and I still like STEC shares.

#176) On March 13, 2009 at 1:00 PM, portefeuille (99.98) wrote: STEC - 7.60 - outperform

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