Comeback Time - Aug 4 article
A little dated but note the removal of being on short sell list
By Larry Barrett
August 4, 1997 3:18 PM PDT
ZDNN
Shares of SyQuest Technology Inc. shot up more than 20 percent Monday on unprecedented volume as investors began rethinking prospects of the maker of portable storage devices.
SyQuest's shares jumped to $3.13 a share, up more than 60 cents on the day, with more than 6 million shares changing hands. Before Monday's frenzy, the stock typically traded on volume of about 1 million. SyQuest said it was unaware of reasons behind its share price, but, after the market closed, it released its fiscal-third quarter results, which showed marked improvement. It reported a net loss of $10.6 million, compared to a $33 million second-quarter loss.
Stiff competition with Iomega Corp. coupled with distribution difficulties resulted in the second-quarter loss. In remarking on the stock swing, SyQuest officials noted that awareness about the company and its products had increased recently. The company said it had launched an aggressive new marketing campaign this weekend. SyQuest also reiterated that it considered a patent lawsuit filed against it by Iomega to be without merit.
"We actually had them as a short sell for awhile, but we've removed that designation," said Eric Beder, an analyst at HD Brous & Co. "They've done a good job of cleaning up their balance sheet and getting back in line."
In the past year, SyQuest has revamped its managerial team and redesigned its product offerings to compete with rival Iomega's more popular and profitable drives.
"In general, when Iomega does well, SyQuest sort of rides its coattails," Beder said. "This a huge market they both serve and they are clearly the two dominant suppliers."
SyQuest, based in Fremont, Calif., is also battling a complex patent infringement suit filed by Iomega over the firm's SyJet line.
SyQuest CEO Ed Harper dismissed the suit calling it "a reckless marketing ploy without any basis in fact." |
