STEC - STEC, Inc. (NASDAQ Stock)

[BadThad]

Big gap down today, about 12% for no apparent reason. Could be another easy bottom play.

STEC, Inc. - Google Finance

Current stock price: $33.43

[BadThad]

From August 3rd. The drop could be the executive sales?

Stec Inc.'s (STEC) second-quarter profit soared, topping the company's own estimates, helped by higher margins and strong sales of its key storage product, ZeusIPOS, and the company issued a strong third-quarter outlook.

However, shares dropped 9.9% to $32.10 in after-hours trading as Stec separately said two of its executives would offer 7.5 million shares in a public offering.

The strength of the ZeusIPOS sales have led Stec to raise expectations repeatedly. Such solid-state drives are designed to replace disk drives and are built using NAND flash memory chips. The devices tend to be faster at retrieving stored data, more energy-efficient and more shock-resistant than disk drives. The downside is that they tend to cost much more than hard drives to store the same amount of data.

For the second quarter, Stec's earnings rose to $19.4 million, or 38 cents a share, up from $1.41 million, or 3 cents a share, a year earlier. The latest results included $2 million in charges for employee severance and asset impairments.

Net revenue jumped 54% to $86.4 million.

In June, the company raised its outlook, projecting earnings of 32 cents to 36 cents a share on revenue of $82 million to $84 million, both well above analysts' estimates at the time.

Gross margin climbed to 50% from 32.3%.

Shipments of the company's ZeusIOPS drives more than quadrupled to $57.7 million.

Looking ahead, Stec projected third-quarter earnings of 45 cents to 47 cents a share on revenue of $95 million to $97 million. Wall Street was looking for 39 cents and $96 million, respectively.

-By Lauren Pollock, Dow Jones Newswires; 212-416-2356; lauren.pollock@dowjones.com

[BadThad]

That's what I get for posting before doing all my DD. Never mind on this company, it's DILUTION that's dropping the price. I cannot recommend a company that dilutes:

STEC, Inc. Announces Pricing of Secondary Offering of 9.0 Million Shares of Common Stock
Thursday, 6 Aug 2009 08:26am EDT
STEC, Inc. announced the pricing of its previously announced public offering of its shares of common stock by Manouch Moshayedi, its Chairman and Chief Executive Officer, and Mark Moshayedi, its President, Chief Operating Officer, Chief Technical Officer, Secretary and a Director. The selling shareholders are selling an aggregate of 9.0 million shares, which represents an increase from the 7.5 million shares previously announced, at an initial per share price to the public of $31.00 per share. The selling shareholders granted the underwriters an option to purchase up to an aggregate of 1,350,000 additional shares solely for the purpose of covering overallotments, if any. STEC will not receive any of the proceeds from sales by the selling shareholders in the offering and the offering will not be dilutive to existing shareholders. J.P. Morgan Securities Inc., Deutsche Bank Securities Inc., Barclays Capital Inc. and Oppenheimer & Co. Inc. are acting as managing underwriters of the offering.

[greencat]

STEC has a W pattern. 1st taget price is between $15.30 and $15.80

STEC Chart

[greencat]

STEC broke the trendline and triggered a buy in my system. Target $21.00


STEC Chart
[/QUOTE]

[greencat]

STEC has a bullish candlestick setup. I expect a higher move to come. Support is at $20.18, while the pivot point is at $21.98, and resistance is at $23.78

STEC is looking to make a huge cop pattern.



STEC Chart

[greencat]

STEC giving a buy signal with the huge cup pattern still ineffect.



STEC Chart