Ashraf Eassa
Long/short equity, contrarian, independent research, tech

STEC: A Long Way From Breakeven, Cash Burn Continues

On March 28th, I stepped to the sidelines on STEC, a former leader in enterprise flash solutions that has seen its core business erode substantially, noting the following:

Should the business turn a corner and start to show real signs of life, there will be plenty of time to hop on board. Right now, the cash burn, competitive pressures, and still-shrinking sales with little-to-no visibility, cement the notion that even as a speculative play, STEC is a poor bet at this time.

Indeed, following the publication of my piece, shares have dropped 21%. Further, while I believe that there may eventually be a compelling play once the company's revenues start showing signs of acceleration (and when the price per...

Join Seeking Alpha PRO to read this archived article and 11,574 other archived articles
IDEA GENERATORXExclusive access to 10 PRO ideas every day
INVESTING IDEAS LIBRARYXExclusive access to PRO library of more than 15,000 ideas
SECTOR EXPERT NETWORKXExclusive access to all sector experts for direct consultation
PERFORMANCE TRACKINGXTrack performance of all PRO stock ideas
PROFESSIONAL TOOLSXProfessional Idea Filters to zero-in based on industry, market cap and more
"In just the first month of using PRO, I used it to generate two ideas which were actionable for me. As a result of these two positions, I have earned more than 20 times the annual subscription costs for PRO."Michael Yagemann, Greenbridge Capital
"I am pleasantly surprised with the scope of small and mid-cap coverage PRO offers. You can't find that any where else."Patrick Rice, Mainstay Capital Management
You may cancel at any time for any reason, and receive a prompt refund for membership on months paid and not used (max. 6 months). Details