Q4 results had been announced January 10th, so today's formal results was a non event.
Guidance revealed today, however, was disappointing. No mention of new customer wins. Full 2011 year expected to be little or no profit. Down annual revenue comparison due to to loss of Net App business. If Dot Hill had compelling technology I would expect that the company's 2011 outlook would be much stronger. No sense talking about 2012, software and storage is a dynamic business. If a vendor has something good there is demand for it and he sells it now. HILL looks to me like a "story stock" that did not follow through with actual customer wins or sales growth improvement. Micro cap stocks are risky, for sure.
Here is my recap of the conference call:
2011 revenue growth guidance: 10-18% (without Netapp)
2011 profit guidance: 1-8c
New OEMs (Lenovo, Samsung) won't really ramp for another quarter or two
Levono is a Tier 1 and half OEM (e.g. bigger than a standard Tier 2)
Estimates do not include any new potential OEM win.
Many new products in prototype form (Especially in the mid-range market)
Many new opportunities this year.
IMHO, the stock will move down and only move up if guidance was very conservative and they exceed it dramatically or they win another Tier 1 OEM at some point in the year.
I did not think the quidance was that disappointing. Nice profit this quarter with 01-08 next year. They were very positive regarding forward profits, higher margins and new customers. The stock may stay around the 3 dollar level for a while though since the first is weak seasonal quarter and traders all want quick pop stock.
You guys are clueless. Go back and listen to past analyst meetings. This guidance is higher than they previously reported due to NTAP business elimination. We all knew that 1st Q 2011 was going to be a loss? They are now projecting a possible break even or profit. What I want to know is how is the 2012 bottom line looking. They stated that it could be as high as .50 by year end 2012. $10 to $12 sto k in one year or less in my book.
You are talking about 2012 and calling others here "clueless"?
Today Wall Street wanted to learn that Dot Hill had some impressive new OEM customer relationships to replace Net App's revenues as well as diminish HILL"s dependency on HPQ revenues. But there was no information or guidance of that kind.
Instead, Hill management talks about "good opportunities". Wall Street doesn't like talk, it likes solid deals and improving numbers.
Dot Hill management basically guided that 2011 numbers would be lower revenues and no profit. You are dreaming if you think Dot Hill can bounce from a no profit 2011 to .50 cents EPS in 2012. If Hill had products that could produce such good results then customers would be buying those products (now) and 2011 would be a much better year than what is forecast.