Science & Technology
Science and Technology
Science and Technology
Thu, December 16, 2010
Wed, December 15, 2010 Dell, Compellent Technologies, Hewlett-Packard, Brightpoint, and Time Warner Cable
CHICAGO--([ BUSINESS WIRE ])--Zacks.com Analyst Blog features: Dell Inc. (Nasdaq: [ DELL ]), Compellent Technologies Inc. (NYSE: [ CML ]), Hewlett-Packard Co. (NYSE: [ HPQ ]), Brightpoint Inc. (Nasdaq: [ CELL ]) and Time Warner Cable Inc. (NYSE: [ TWC ]).
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Here are highlights from Tuesdaya™s Analyst Blog:
DELL to Acquire Compellent
Round Rock, Texas-based PC maker Dell Inc. (Nasdaq: [ DELL ]) signed a definitive agreement to acquire storage-solution provider Compellent Technologies Inc. (NYSE: [ CML ]). The all-cash deal, valued at $960.0 million, or $27.75 per share of Compellent, is expected to be completed by early 2011. It is expected to be accretive to pro forma earnings in fiscal 2012. Shareholdersa™ approval is still pending.
Data storage plays a crucial role in cloud computing, which helps users access remote computing power and data over the Internet. Founded in 2002, Compellent Technologies is a global provider of enterprise data storage systems, which facilitates the automation of data movement and management at the block or granular level. The company developed its flagship Storage Center software and hardware solution aimed at mid-size enterprises, selling them through an all-channel network of independent solution providers and resellers.
Della™s storage offerings drive efficiency and reduce costs by streamlining operations. Compellenta™s storage products will complement Della™s enterprise storage solution suite. After completion, Dell will integrate the Compellent assets into its storage portfolio to strengthen the existing level of its storage offerings. The new unit will facilitate automated data transfer and management, tiering and thin provisioning.
The enhanced storage platform will attract new users. Moreover, Dell will also have access to Compellenta™s existing customer base and channel partners.
Dell entered the storage market in 2008 with its purchase of EqualLogic. However, the company was out of luck with its much-hyped bid for 3PAR Inc., losing out to archrival Hewlett-Packard Co. (NYSE: [ HPQ ]). 3PAR provides highly virtualized storage solutions with advanced data management features (dynamic tiering, thin provisioning, etc.) for cloud computing environments. We believe the prospective synergy from Compellenta™s acquisition will be able to cover the 3PAR loss, to some extent.
Brightpoint to Acquire Touchstone
Brightpoint Inc. (Nasdaq: [ CELL ]), a leading global wireless device distributor and customized logistics services provider, recently entered into an agreement to acquire privately held Touchstone Wireless Repair and Logistics, L.P. Touchstone is a leading provider of repair and reverse logistics services to the wireless industry. Brightpoint will pay $80 million in cash for this acquisition.
Brightpoint provides a full range of sales & distribution, logistics, and activation services to wireless device manufacturers and carriers. The company enhanced its portfolio of product offerings for customers, while developing new sales channels for its suppliers.
The acquisition of Touchstone will transform the merged entity as a formidable player in the industry offering both forward and reverse logistic services. Brightpoint expects this deal to be closed by end 2010 and slightly accretive to its EPS in 2011.
During the third quarter of 2010, Brightpoint supplied 24.907 wireless devices, up 14.3% year over year and 11.7% sequentially. Management predicted that for fiscal 2010, the company will supply wireless devices within the range of 98 million - 100 million, up 18% - 20% year over year. Out of this, 77% - 80% of its total wireless devices handhelds will be managed through high-margin logistics services.
Brightpoint has a solid global customer base. Management continues to seek new operational initiatives that foster improved customer handling of handsets, in particular PDAa™s, data and 3G wireless devices. The company will now integrate Touchstonea™s state-of-the-art asset management and product recycling activities to offer a whole bunch of innovative supply-chain management systems in more than 25 countries.
Brightpoint has an existing agreement with Time Warner Cable Inc. (NYSE: [ TWC ]) to provide transportation management, inventory management, device customization, fulfillment, and reverse logistics for the lattera™s WiMAX venture. Brightpoint also launched a program to provide call center customer support, emission management services, and activation services to telecom, technology, and pharmaceutical companies.
We maintain our long-term Neutral recommendation for Brightpoint. Currently it is a short-term Zacks #2 Rank (Buy) stock.
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