Tag - HILL

Stocks extended their gains for a second day in a row with all major indices closing up, though below a one percent gain.

The Dow finished the session at 9,398, up 37 points; the Nasdaq closed today at 2,009, up 11 points; and the S&P 500 finished at 1,012, up 7 points.

The Russell 2000 index, a composite of the leading small-cap stocks, closed at 575, up 4 points.

Small-cap price movers were lead by Kodiak Oil (Amex:KOG), up 30%. Following KOG were Dot Hill Systems (Nasdaq:HILL), up 22%; Pacer International (Nasdaq:PACR), up 16%; BioSante Pharmaceuticals (Nasdaq:BPAX), up 16%; and ACADIA Pharmaceuticals (Nasdaq:ACAD), up 16%.

*****Last week's better-than-expected payroll data is being offset by new jobless claims today. 558,000 people filed new claims for unemployment benefits. That was more than the median estimate of 545,000.

The number of people collecting unemployment fell by 141,000 and that lowers the unemployment rate. That sounds good, but I don't think it is. Most likely, benefits for these 141,000 have run out. So what little money they had coming in is now gone and they've just stopped asking. 

*****The most direct effect of massive unemployment is less spending and less revenues for America's retailers. Wal-Mart (NYSE:WMT) beat earnings but missed on revenue. That basically means Wal-Mart fired a bunch of people to cut costs, then those people spent less at the store.

Overall, retail sales were down 1% in July after a 0.8% rise in June. With the unemployment rate still expected to rise to over 10%, and likely to stay at high levels for a few years, there's not a lot of upside for the retail sector.

*****SmallCapInvestor PRO members are just a few pennies away from knocking down another 100% winner. This time, it's a Chinese organic fertilizer company. The stock has been on a tear for the last month. And despite the fact that it's nearly doubled, the forward P/E is 17 and the PEG ratio is .45. In other words, there are more gains to come.

I have a new special situations report with detailed research on my 100% China winner plus two other high flying Chinese stocks. Click here to get this report now.

And speaking of SmallCapInvestor, we're open for voting for the t-shirt slogan for my first book, The Small Cap Investor: Secrets to Winning Big with Small Cap Stocks. There are some excellent slogan ideas, and if you'd like to help pick a winner, you can cast your vote for the best slogan at the SmallCapInvestor Facebook page.

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I'd like to thank SCI Daily readers for helping with the marketing of my first book. You're helping make it a success and I really appreciate it.

*****I probably shouldn't do this, but TradeMaster Daily Stock Alerts technical analyst Jason Cimpl is alerting his readers to breakouts in the biotech sector. A couple names he's watching are Orexigen (Nasdaq:OREX) and Jazz Pharmaceuticals (Nasdaq:JAZZ).

Jason thinks Jazz is good for a 21% move from current levels, so if you're looking for a short-term trade from TradeMaster, this might be a good one.

Be on the look-out for tomorrow's SCI Daily as Jason will once again provide readers with video charting of the week's movements and most importantly, his outlook for how to trade for profits in the coming week. Look for this in tomorrow's issue of SCI Daily.

*****Investors are ignoring short-term weakness in oil demand and focusing on the long-term fundamentals. Oil prices are back over $71 a barrel today despite the highest reserve levels since 1991.

Barclay's expects oil prices to average $76 a barrel in the third quarter. And don't forget, hurricane season is looming. Oil stocks should be bought on dips.

Ian Wyatt
Editor
SCI Daily

Dot Hill Systems Corp. (Nasdaq:HILL) shares lost about 17% Thursday after the Carlsbad, Calif.-based company revised its 2008 second quarter guidance earlier in the day to include a larger net loss. The network storage system company expects a net loss between $0.12 and $0.16 per share, compared with earlier estimates for a loss of $0.07 to $0.10 per share. The company said the increased net loss was due to lower-than-expected product margins and higher-than-expected expenses.

Shares were down 16.89% to $2.51 apiece, compared with Wednesday’s close of $3.02.

The Russell 2000 (NYSE:IWM) fell as news of an unexpected decline in first-quarter profit at General Electric Co. (NYSE:GE) sparked a sell-off. The small-cap index let go 19.26 points, or 2.72%, to 688.16. The Dow Jones Industrial Average declined 256.56 points, or 2.04%, to 12,325.42.

On a year-to-date basis, the Russell 2000 has shed 10.17%, while the Dow has retreated 7.08% and the S&P 500 is down 9.23%.

Small caps opened lower and moved deeper into the red throughout the session following news before the start of trading that General Electric suffered an unexpected decline in first-quarter profit and lowered its full-year 2008 earnings guidance.

The Fairfield, Conn.-based company, which rarely misses analysts’ expectations, is considered an economic bellwether due to its size and reach.

Another indicator pointing to serious economic problems came after the start of trading when Reuters/University of Michigan reported that its index of consumer confidence fell to a worse-than-expected reading of 63.2 in April, the lowest level since 1982. In March the index came in at 69.5.

Among the small-cap losers today was C&D Technologies, Inc. (NYSE:CHP). The Blue Bell, Pa.-based maker of standby power systems reported after . . .

Dot Hill Systems Corp. (Nasdaq: HILL) warned this morning that it now expects lower revenues for the third quarter than it previously guided for, but also said it expects a narrower net loss than previously anticipated.

For the three months ended Sept. 30, the storage systems provider said it now anticipates revenues to be in the range of $43 to $46 million based on preliminary results. This compares with previously issued revenue guidance of $50 million to $54 million and revenues of $54.8 million in the third quarter of 2006. Three analysts polled by Thomson Financial are on average anticipating revenues of $53.24 million.

The Carlsbad, Calif.-based company attributed the revenue deflation primarily to slower than projected product ramp of one of its large original equipment manufacturers.

The company also narrowed its expectations for a net loss. It expects to report a net loss in the range of $0.06 to $0.11 per share, an improvement over original guidance of a net loss of $0.09 to $0.14 per share.

This compares to a net loss of $1.34 per share in the third quarter of 2006, inclusive of a tax charge of $1.17 per fully diluted share. Excluding this tax charge, the net loss for the third quarter of 2006 would have been $0.17 per share.

The following small-cap companies are among the newsmakers in after-hours trading Wednesday: