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Xyratex Ltd. Şti. Message Board

  • putsandcalls2008 putsandcalls2008 Jan 13, 2010 10:05 AM Flag

    I bailed at 16 (well half position) thats a nice hit congrats longs


    but 10% up in 2 days is alot.Love the co still holding half..looking to add if dips and sell the rest at 17 if it runs more.. nice day congrats.

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    • Out as well here.

      I was, quite frankly, shocked at the huge miss on both earnings and revenues -- particularly in a company with 77% institutional ownership (who presumably had fairly close contact with management). Somebody in management guided the analysts to the numbers they published. Who's to say those same people aren't overestimating next quarter's numbers?

      We all know how Wall Street firms work. XRTX is fairly thinly traded. In not-very-liquid stocks, in order for institutions to divest themselves of their positions, they've got to generate buying momentum thru upgrades in order to get rid of their positions -- at least that's how I view today's action.

      I'm happy for the profits I made -- and REALLY happy to be able to get out with them after that very poor earnings report.

      Longs, be careful.

      • 2 Replies to abbeachbunny
      • You're a joke! Conspiracy theorist! Simply put - there was a recession and both individual buyers and corporations held off on buying storage. I know at my company (with 20K employees) for the first time in 10 years they were telling us not to e-mail large files, not to keep too many obsolete "prior versions" of work, don't send/save pictures.

        So now XRTX gets a boost from 2009's artificial decline in addition to the strong long-term growth this business has. Yet XRTX has not nearly recovered from the irrational selling of the panic. That’s why its a very very low risk play.

        Look at a five year chart and consider prospects have never been better. Current valuation make no sense. They have a great balance sheet, they have become the largest OEM storage supplier, they are expanding their customer base and they are the technology leaders.

      • I didn't listen to the CC, but I presume the earnings miss was due to a backlog of orders in Q4 2009 that were deferred to Q1 2010. Management probably expected to fill the orders in Q4, hence the higher estimates and expectations.

        This has happened before to XRTX.

        Certainly not a desirable result, but it doesn't appear to represent underlying weakness in XRTX business, especially in light of the massive increase in expected earnings for all of FY2010.


    • It never hurts to ring in the register. Congrats on the trade and hopefully you will make more on the remaining half position