EMC Boosts Earnings on Strong Demand for Storage

EMC Corp., the world's biggest maker of data-storage computers and software, said fourth-quarter profit was $389 million ($0.18/share), tripling the $0.06/share it earned in Q4 2006 and matching analyst estimates, helped by strong sales of its super-huge computers as customers continue to require more space for digital document storage. Sales were up 19% to $3.2 billion. EMC gave 2007 earnings guidance of at least $0.64/share on revenue of at least $12.7 billion. A.G. Edwards & Sons Inc. analyst Aaron Rakers in St. Louis: "We are starting to see competitive dynamics shift to EMC." He rates the stock Buy/Aggressive, and says HP will not have a product to compete with EMC until at least 2008. Shares traded up $0.23 (1.7%) to $13.70 in pre-market trading.

• Sources: Bloomberg, MarketWatch
• Related commentary: Goldman On IT Trends: What Tech Companies Stand To Gain?, Goldman On IT Trends: What Tech Companies Stand To Gain?, LBO Fever -- Barron's Looks at Who May Be Next. Conference call transcripts: Check for EMC's Earnings Conference Call Transcript later today.
• Potentially impacted stocks and ETFs: EMC Corp. (EMC). Competitors: Hewlett-Packard Co. (HPQ), International Business Machines Corp. (IBM), Dell Inc. (DELL), Sun Microsystems Inc. (SUNW), Seagate Technology (STX). NCR Corp. (NCR). ETFs: PowerShares Dynamic Hardware & Consumer Electronics (PHW), HOLDRS Internet Architecture (IAH)

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