Time to take a look at Netlist (NLST)?
  • Stock Alert for Netlist Inc. (NLST)
  • Stock Alert for Netlist Inc. (NLST)
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    Stock Alert for Netlist Inc. ($NLST)

    Netlist Inc. (NASDAQ: NLST)

    Netlist Inc. (NLST), designs, manufactures and sells memory subsystems primarily for the server, high-performance computing and communications markets. The Company’s memory subsystems consist of dynamic random access memory integrated circuits (DRAM ICs), NAND flash memory (NAND) and other components assembled on a printed circuit board (PCB). The Company also designs custom semiconductor logic devices, which are integrated into its memory subsystems. Net sales to two customers, Dell (DELL) and Hewlett Packard (HPQ), represented approximately 90% of the Company’s net sales during the fiscal year ended January 3, 2009 (fiscal 2008). Net sales to some of its original equipment manufacturer (OEM) customers include memory modules that are qualified by NLST directly with the OEM customer and sold to electronic manufacturing services providers (EMSs), for incorporation into products manufactured exclusively for the OEM customer.

    The Company was founded in 2000 and is headquartered in Irvine, California.

    Share Statistics (12-May-10) FY

    2007

    FY

    2008

    %

    Chg

    Q4 2008 Q4 2009 %

    Chg

    Symbol NLST Revenue, $Mn 100.1M 67.0M 33.1% 6.60M 6.70M 1.5%
    Current price $3.21 Gross marg. 8.8% 11.3% 28.4% -4.2% 25.4% 704.8%
    52wk Range: $7.98-3.22 Oper. margin -11.8% -18.3% 55.1% -75.8% -43.3% 42.9%
    Avg Vol (3m): 858,676 Net margin -7.4% -22.7% 206.8% -75.2% -44.8% 40.4%
    Market Cap. 64.57M
    Dil. Shares Outst. 24.2M EPS, $ -0.38 -0.77 102.6% -0.25 -0.15 40.0%

    Source: Reuters.com, SEC Filings.

    Financial Summary

    Revenues for the first quarter ended April 3, 2010, were $7.9 million, up 265% from revenues of $2.2 million for the first quarter ended April 4, 2009. Sequentially, revenues improved 17.8% from the $6.7 million in revenues for the fourth quarter ended January 2, 2010. Gross profit for the first quarter ended April 3, 2010, was $1.8 million, or 23.0% of revenues, compared to a gross loss of $537,000, or negative 24.8% of revenues for the first quarter ended April 4, 2009.

    Net loss for the first quarter ended April 3, 2010, was $3.0 million, or $0.14 loss per share, compared to a net loss in the prior year period of $3.8 million, or $0.19 loss per share. These results include stock-based compensation expense in the first quarter ended April 3, 2010, of $382,000 compared with $307,000 in the prior year period.

    The Company sold 4.6 million shares of common stock in a registered public offering in March 2010. The shares were sold to the public at a per share price of $3.85. The Company received net proceeds of $16.3 million, after underwriting discounts and commissions, and estimated expenses payable by the Company.

    As of April 3, 2010, cash, cash equivalents and investments in marketable securities were $26.4 million, total assets were $41.9 million, working capital was $27.5 million, total debt was $125,000, and stockholders’ equity was $33.0 million.

    Financial Strength (12-May-2010) Company Industry Sector S&P 500
    Quick Ratio (MRQ) 2.42 0.52 1.36 0.77
    Current Ratio (MRQ) 2.70 0.63 1.60 0.91
    Long-Term Debt to Equity (MRQ) 0.26 8.90 17.90 130.01
    Total Debt to Equity (MRQ) 0.83 14.63 29.26 196.59

    Source: Reuters.com, SEC Filings.

    Analyst Consensus

    No chart available.

    Source: www.ft.com

    No consensus analysis data available.

    Source: http://www.reuters.com/finance/stocks/financialHighlights?symbol=NLST.W

    Investment Highlights

    NLST, a designer and manufacturer of high-performance memory subsystems, recently announced it has reached a milestone with the shipment of more than 1 million units of the NetVault-Battery-Backed (BB) module since inception. This milestone includes its recently announced third-generation RAID cache transportable battery-backed module shipping in production to Dell Inc.

    NetVault-BB retains memory data during system power failures when connected to a Li-Ion Battery Pack. The module features interfaces that support smart battery compliant fuel gauge temperature indicators, and provides a system management bus (SMB) interface. Additionally, auto and self-refresh capabilities are supported.

    NLST introduced its low voltage HyperCloud(TM), the industry’s highest density 1.35V virtual rank memory module. Supporting up to 384GB of DRAM populated in a single dual socket server, low voltage HyperCloud now offers datacenters the ability to realize up to 19% in memory power savings when compared with traditional 1.5V solutions.

    Low voltage HyperCloud memory features low latency and supports 3 DIMMs per channel (3 DPC) at a transfer rate of 1067 MT/s (backward compatible with 3 DPC 1333 MT/s at 1.5V) to provide maximum memory bandwidth and increased server performance versus standard registered DIMMs (RDIMMs) at 1.35V. It also utilizes Netlist’s patented rank multiplication ASIC technology to fully populate three memory channels with 16GB 2 virtual rank (vRank) RDIMMs.  Four physical ranks are hidden from the memory controller hub and presented as two virtual ranks. Dual socket servers can then be fully populated with 24 16GB 2 vRank RDIMMs (4 DPC) reaching a total capacity of 384GB.

    NLST will debut a 4GB low voltage HyperCloud module in an IBM x3550 M3 server along with other HyperCloud demonstrations, including “Datacenter in a Box,” at Interop on April 27-29 at the Mandalay Bay Convention Center in Las Vegas, booth number 850. The “Datacenter in Box” will showcase how to run a datacenter from a single server utilizing 288GB of HyperCloud memory.

    NLST plans to sample customers with 1.35V low voltage HyperCloud this quarter and expects to be in production during the second half of this year.

    Source: http://www.netlist.com/

    Technical Analysis

    Source: http://stockcharts.com

    NLST is below its 50-day moving average. This bearish sign is even more significant because the moving average is also trending lower.

    NLST’s recent volatility has been greater than normal. This is evidenced by the increased distance between the upper and lower Bollinger Bands. These bands measure volatility using standard deviation and a large width is due to high volatility. Additionally, NLST is trading within its Bollinger Bands. This is a normal condition and suggests that the stock is neither overbought nor oversold relative to the recent price action.

    NLST’s MACD is currently indicating a weak bullish signal. Although the MACD is trending above the signal line, the indicator is still below zero, which suggests that the underlying moving averages are bearish.

    Comparative Analysis

    Company Name Ticker Price per Mrkt. Cap. P/E P/S
    May12-2010 symbol Share, $ $ Mn 2009 2010 2009 2010
    Firstmark Corp. FIRM 0.18 961.56K n/a n/a 4.86 n/a
    Dataram Corp. DRAM 2.20 19.62M n/a n/a 0.73 n/a
    IXYS Corp IXYS 8.79 275.39M n/a n/a 0.98 n/a
    Drug Manufacturers Median 98.65M n/a n/a 2.19 n/a
    Netlist Inc. NLST 3.21 64.57M n/a n/a 2.80 n/a

    Source: Thomson Financial

    Insider Trading Activity

    NET SHARES PURCHASE ACTIVITY

    Inside Purchases – Last 6 Months

    Shares Transaction
    Purchases n/a 0
    Sales 75,000 2
    Net Shares Purchased (Sold) (75,000) 2
    Total Insider Shares Held 9.57M n/a
    % Net Shares Purchased (Sold) (0.8%) n/a

    Net Institutional Purchases — Prior Qtr to Latest Qtr
    Shares
    Net Shares Purchased (Sold) 364,461
    % Change in Institutional Shares Held n/a

    Source: Yahoo Finance

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