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Datalink Corporation Message Board

  • gandhip gandhip Jul 20, 2011 4:46 PM Flag

    After hours volume huge!

    We need the visibility and that after hours volume is very telling.... Just what we need and perfect recipe for the next growth leg. This stock can climb on pure mention alone w/o any better performance. We see 10+ next week w/ volume @ 350k+ daily and added coverage and upgrades...

    Just think of this, if we just get 1x sales with the current profit and cash generation which is VERY conservative, we are $18- $20 stock. I get this by multiplying the current price by x1.4 which would get us from .4x sales to 1x.

    Something to think about...

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    • Who knows? The AH volume with 16% up might be telling us this company can move like JVA if that uncanny momentum really kicks in to this company for a few weeks to come.

      A lot of things uncommon and out of our sense happen all the time in the stock market.

    • You're correct. They have a bank line, but its limit must have been maxed out. The line limit must be around $3.6 to $4 million. It must be too small to cover the cash shortage from $55 million A/R outstanding. They had to rely on new common stock offerings of $18 million since they collected only about $3.7 million from the A/R last quarter. This company must be having some problems collecting A/R on time.

    • I believe they do have a bank line of credit, but sitting on cash does them no good.

    • Dude,

      Get sober from your fantasy of this stock going to $20.

      The quarterly revenues as of 12/31/2010 were $91 million with $2.4 million earnings. The current 52-week price of $9.05 already reflects
      the $89 million revenues and $2.6 million earnings released today, which means the stock price could drop hard tomorrow morning, only to stay around $8 to $9 range.

      I think the analyst under-projected the current quarter's revenues/earnings since the revenue trend since 12/31/2010 was downward (no wonder it was easy for this company to beat the estimate). Besides, the current quarter's revenues of $89.5 million is only about 4% more than the last quarter's revenues of $85.7 million.

      Nothing really to cheer about..

    • The only problem I see right now is the tendency for this stock to get pushed around between earnings reports, and give back a good portion of its gains in the weeks following the great reports.

      Of course, some of that activity has been because of the market as a whole.

      I've been holding a number of shares for LT gains, just in case they're acquired, then trading the rest. I'm hoping we'll see the analysts up the FY 2011 EPS estimate to something between $0.65 and $0.70, and the FY 2012 estimate to, say, $0.76.

      A very conservative forward PE of 13 on the 2012 estimates would give a price of $9.88.

      I will be looking to reduce my holdings down to my LT core as we break into the $9s.

      Then I'll wait for the economy and overall market to take the stock back down before rebuilding the shorter-term position.

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