The Future of Solid State Technology

• By the tickerspy.com Staff
• On 11:11 am EDT, Wednesday October 14, 2009

Intel's (NASDAQ: INTC - News) numbers are the talk of Wall Street today, but a small corner of the tech sector is more focused on reading between the lines.

Intel beat expectations in the third-quarter, sending its stock higher and improving investor sentiment across Wall Street. The tech bellwether has its fingers in a lot of pots, and for now the solid-state storage segment was too small to warrant mention during the company's scripted conference call yesterday evening. During the Q&A period, however, CEO Paul Otellini suggested future developments. "We've got a couple other platform ideas that you'll see unfolding from us over the next couple of years using this technology," said Otellini, referring to the company's NAND flash memory business.

Meanwhile, solid-state drives are an option for a growing number of products at the consumer and enterprise levels. From Apple's (NASDAQ: AAPL - News) paper-thin MacBook Air to IBM's (NYSE: IBM - News) Power 595 UNIX server.

Right now the price of NAND memory is a major hurdle for solid-state drive (SSD) technology, but according to Otellini, Intel's NAND group is moving closer to profitability. If the industry's pioneers can boost margins on SSDs, more components of the Data Storage Stocks Index might jump into the market.

Currently STEC (NASDAQ: STEC - News), which makes the SSDs available in IBM's Power 595 server, among other applications, is the storage sector's worst performer over the last month. It is also the only stock in negative territory over the last week.

Sun Microsystems (NASDAQ: JAVA - News), soon to become a unit of Oracle (NASDAQ: ORCL - News) pending Justice Department approval, announced the development of the highest-performing SSD array on the market on Monday. Sun's flash-based array has a storage capacity of 2 terra-bytes, and can read and write 1.6 million and 1.2 million input/output operations per second respectively, according to coverage by InformationWeek.

Elsewhere in the data storage sector, Quantum (NYSE: QTM - News), Hutchinson Technology (NASDAQ: HTCH - News), and NetApp (NASDAQ: NTAP - News) are all up by double-digit percentages in the last five sessions.

Investors can look to the Data Storage Stocks Index for performance trends and a suite of other metrics to aid in due diligence related to the sector's U.S.-listed equities. With constant demand for faster, more efficient, and less expensive computing devices, it will be interesting to track these stocks moving forward.

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