Tag Archives: technology

Pure Storage Remains Valiant In Fierce Battle With EMC, NetApp

Tectonic shifts to cloud computing and flash storage make the time ripe to build a new storage franchise, with Pure Storage ( PSTG ) seen as an industry disruptor. Pacific Crest Securities analyst Brent Bracelin, in a new research note, says that Pure Storage has been able to sustain solid growth and market share gains despite legacy vendors such as EMC ( EMC ) and NetApp ( NTAP ) putting Pure Storage in their cross hairs. Bracelin’s report came as Pure Storage introduced several new products on Monday that expand its portfolio of storage systems, including products that integrate more tightly with server gear from Cisco Systems ( CSCO ). Pure Storage provides the $24 billion enterprise storage market with technology using flash chips, similar to the chips that smartphones use. Flash-based storage arrays are much faster than disk-drive storage systems but come at a higher price, depending on how the technology is deployed. Flash is seen as the future of storage, with the transition well underway but still in the early stages. “We believe these new products, coupled with continued declines in flash pricing to less than $1 per GB, should give Pure Storage the ammunition to sustain share-gain momentum into 2016,” Bracelin wrote. EMC and NetApp lead in the disk-storage systems market and also have expanded into flash-chip storage systems. NetApp and EMC, which Dell is acquiring, are much larger than Pure Storage, but the smaller company is growing much faster. It has yet to turn a profit, however. Storage Ready For Revolutionary Changes Pure Storage revenue has zoomed from $6 million in 2013 to $440 million for its fiscal 2016 ended Jan. 31. But the company has posted big losses as it spends heavily on research and development and on marketing to grow market share. Pure Storage kept its string of triple-digit revenue growth alive on March 2, when it posted fourth-quarter earnings that beat Wall Street estimates, as did its Q1 outlook. Company CEO Scott Dietzen says that the data storage industry is on the cusp of a revolutionary change that Pure aims to lead. But a recent report from Summit Research said that while Pure Storage has cutting-edge data technology, it will face an  uphill battle trying to dislodge EMC and NetApp. Bracelin has an overweight rating on Pure Storage stock and a price target of 24. Pure Storage stock was near 12.50, in midday trading on the stock market today   — down 3% despite the bullish research note. Pure raised $425 million with its initial public offering on Oct. 7, pricing shares at 17. The stock peaked at 20.60 on Oct. 15 and hit a low of 11.05 on Feb 8. “While execution risks remain elevated as legacy vendors attempt to grab share by discounting storage pricing, a solid track record of execution since the October 2015 IPO increases our confidence that Pure Storage can sustain solid momentum and share gains,” Bracelin wrote. Image provided by Shutterstock .

Vivint Solar Burned On Widening Q4, 2015 Losses In SunEdison’s Wake

Vivint Solar ( VSLR ) stock combusted Tuesday after the No. 3 residential installer reported mixed Q4 earnings results, underperforming an equally blended Q4 for Chinese solar panel-maker JA Solar ( JASO ). Vivint Solar’s late Monday report comes a week after the company scrapped its sale to   SunEdison ( SUNE ), which, according to a Vivint 8K filing, likely couldn’t afford to close the deal as it faces an ongoing liquidity investigation. In midday trading on the stock market today , Vivint Solar stock was down 12%, near 3.50 and touching an all-time low for the fourth straight trading day. JA Solar stock, meanwhile, was down 4%, near 8.75. JA Solar reported before the open Tuesday. SunEdison stock also fell, sitting down nearly 3% midday Tuesday. Collectively, IBD’s 21-company Energy-Solar industry group was down 1.5%. The group ranks No. 48 out of 197 groups tracked. Vivint Reports Widening Losses For Q4, Vivint Solar reported a 132% year-over-year sales jump to $16 million. But losses per share ex items deepened to 50 cents vs. 36 cents in the year-earlier quarter. Two analysts polled by Thomson Reuters expected a 71-cent loss per share and $19.3 million in sales. Vivint Solar booked 80 megawatts and installed 59 MW during Q4, up a respective 56% and 17% vs. the year-earlier quarter. Cumulative installations reached 68,527, including a 23% year-over-year bump to 8,411 during the quarter. For the year, Vivint Solar’s $64.2 million in sales and a $2.39 per-share loss ex items missed the consensus expectations for $68.2 million and a loss of $1.83, respectively. Sales grew 154%, but losses deepened from $1.99. The company didn’t provide current-quarter guidance. Analysts are expecting $16.3 million and a 66-cent per-share loss ex items. Sales would grow 71%, but losses would widen from 57 cents in the year-earlier quarter. JA Solar Guides Shipments Up Before the open Tuesday, JA Solar reported $709.3 million (RMB 4.6 billion) in sales and 49 cents (RMB 3.14) earnings per American Depositary Share ex items, up 28.5% and 81.5%, respectively, on a year-over-year basis. Sales topped the consensus of the two analysts for $683.3 million (RMB 4.5 billion) and JA Solar’s earlier views for $680 million to $710 million (RMB 4.4 billion to RMB 4.6 billion). But EPS missed Wall Street’s expectation for 68 cents. JA Solar topped its earlier guide to 1.32 gigawatts to 1.35 GW shipped, with 1.366 GW shipped during Q4. For the year, JA Solar shipped 4 GW, up 29% and topping guidance for 3.92 GW to 3.95 GW. JA Solar guided to 1 GW to 1.1 GW in current-quarter shipments, which would be up 54% at the midpoint. For the year, JA Solar sees 5.2 GW to 5.5 GW in shipments, up 30%-37.5% vs. 2015. The company doesn’t provide financial guidance. The consensus expects $421.7 million (RMB 2.75 billion) in sales and 20 cents (RMB 1.30) earnings per ADS ex items for the current quarter, up 9% and 53%, respectively. For the year, analysts model $1.65 (RMB 10.74) earnings per ADS minus items on $2.26 billion (RMB 14.68) in sales, both up 8%.

Valeant Stock Plummets As Guidance Slashed After Q4 Earnings Miss

Shares of Valeant Pharmaceuticals International ( VRX ) plunged to a four-year low Tuesday after the specialty drugmaker’s Q4 earnings and guidance missed analysts’ expectations. Valeant reported adjusted earnings of $2.50 a share, 11 cents short of the consensus estimate of analysts polled by Thomson Reuters. Revenue of $2.79 billion beat consensus by about $40 million. The results were preliminary and unaudited because of an ongoing review of the company’s current and past financial reporting after a scandal broke out last fall, delaying the filing of the 10-K annual report. Valeant didn’t provide year-over-year comparisons because 2014 financials are still under review, but it previously reported Q4 2014 earnings of $2.58 a share on revenue of $2.28 billion, so on that basis EPS fell 3% and sales rose 22%. Valeant slashed its guidance for the current quarter. It now expects revenue of $2.3 billion to $2.4 billion, more than $500 million below its previous guidance, with EPS guidance down about $1 to a range of $1.30 to $1.55. For the year, Valeant hacked more than $1 billion off its sales guidance, now $11 billion to $11.2 billion, with the EPS range down more than $3 at $9.50 to $10.50. Valeant stock plunged 44.5% to 38.34 in late morning trade on the stock market today , its lowest point since November 2011. There were multiple reasons for the shortfall, many to do with the messy transition of the company’s business model in the wake of the scandal. Valeant had severed its relationship with now-defunct specialty pharmacy Philidor after a number of allegations were lodged against it. In December, Valeant announced a new partnership with Walgreens Boots Alliance ( WBA ) to distribute the dermatology and ophthalmology drugs previously channeled mostly through Philidor, but Valeant CEO J. Michael Pearson admitted on the company’s earnings conference call with analysts that the deal hadn’t been well received, and Valeant has made unspecified changes after complaints from distributors. Pearson said Valeant has also been negotiating with payers over the pricing and rebating of drugs, which also contributed to the reduced guidance. Valeant has been the target of criticism all the way up to the U.S. Congress over its historic price increases, but the Walgreens deal brought with it a 10% price cut across the board. Pearson said that, overall, Valeant’s price increases this year are among the lowest in the industry, as it’s tried to accommodate payers. Pearson said that the impact of most of this is being felt in Q1, and that “we in essence lost a quarter.” For that reason, Valeant gave guidance for the 12 months starting April 1, which it says is more representative of its business going forward. Valeant expects EPS of $10.75 to $11.25 for the period, which is still below the Street’s average estimate of $15.02. It forecast revenue of $11.6 billion to $11.8 billion, which has no point of comparison, since there isn’t a consensus revenue number for Q1 2017.