This Day On The Street
Continue to site right-arrow
ADVERTISEMENT
This account is pending registration confirmation. Please click on the link within the confirmation email previously sent you to complete registration.
Need a new registration confirmation email? Click here
Cramer's Action Alerts PLUS - See his portfolio and get alerts BEFORE every trade. Learn more NOW!

Rackable Rockets on Sun Rumor

Rackable Systems (RACK) shares shot up Thursday as the server maker became the latest company to get swept up in a frenzy of speculation about acquisitions in the tech sector.

While none of the tech buyout rumors has borne out so far, investors cottoned to the newest chatter and sent Rackable shares up more than 11%, or $1.82, at $18.28 in trading.

Earlier this week, investors ran up shares of Palm (PALM) and Gateway (GTW) in hopes that the companies would be acquired. Both stocks have since given back the gains, as the prospects of the rumored deals appeared less likely.

Rackable's putative suitor is Sun Microsystems (SUNW).

"There's a rumor around -- strictly a rumor -- that Sun is going to buy them," says Chirag Vasavada, a hardware analyst with T. Rowe Price.

Rackable has been a subject of buyout rumors in the past, although Dell (DELL - Get Report) has usually been the rumored acquirer, notes Vasavada. "Sun is a little bit of a new name thrown into the discussion," says Vasavada, whose firm is long Rackable.

Milpitas, Calif.-based Rackable sells servers based on industry standard x86 microprocessors made by Intel (INTC - Get Report) and Advanced Micro Devices (AMD - Get Report).

The company's focus on customizing its machines so that they consume less energy and can be packed closer together in corporate data centers has won it some key customers.

1 of 2

Check Out Our Best Services for Investors

Action Alerts PLUS

Portfolio Manager Jim Cramer and Director of Research Jack Mohr reveal their investment tactics while giving advanced notice before every trade.

Product Features:
  • $2.5+ million portfolio
  • Large-cap and dividend focus
  • Intraday trade alerts from Cramer
Quant Ratings

Access the tool that DOMINATES the Russell 2000 and the S&P 500.

Product Features:
  • Buy, hold, or sell recommendations for over 4,300 stocks
  • Unlimited research reports on your favorite stocks
  • A custom stock screener
Stocks Under $10

David Peltier uncovers low dollar stocks with serious upside potential that are flying under Wall Street's radar.

Product Features:
  • Model portfolio
  • Stocks trading below $10
  • Intraday trade alerts
14-Days Free
Try it NOW
Only $9.95
Try it NOW
14-Days Free
Try it NOW

Check Out Our Best Services for Investors

Dividend Stock Advisor

David Peltier identifies the best of breed dividend stocks that will pay a reliable AND significant income stream.

Product Features:
  • Diversified model portfolio of dividend stocks
  • Updates with exact steps to take - BUY, HOLD, SELL
Trifecta Stocks

Every recommendation goes through 3 layers of intense scrutiny—quantitative, fundamental and technical analysis—to maximize profit potential and minimize risk.

Product Features:
  • Model Portfolio
  • Intra Day Trade alerts
  • Access to Quant Ratings
Options Profits

Our options trading pros provide over 100 monthly option trading ideas and strategies to help you become a well-seasoned trader.

Product Features:
  • Actionable options commentary and news
  • Real-time trading community
Try it NOW
Try it NOW
Try it NOW
To begin commenting right away, you can log in below using your Disqus, Facebook, Twitter, OpenID or Yahoo login credentials. Alternatively, you can post a comment as a "guest" just by entering an email address. Your use of the commenting tool is subject to multiple terms of service/use and privacy policies - see here for more details.
Submit an article to us!
SYM TRADE IT LAST %CHG
DELL $0.00 0.00%
RACK $0.56 0.00%
AMD $3.11 0.00%
INTC $33.25 0.00%
YHOO $44.28 0.00%

Markets

DOW 18,132.70 -81.72 -0.45%
S&P 500 2,104.50 -6.24 -0.30%
NASDAQ 4,963.5270 -24.3630 -0.49%

Partners Compare Online Brokers

Free Reports

Free Newsletters from TheStreet

My Subscriptions:

After the Bell

Before the Bell

Booyah! Newsletter

Midday Bell

TheStreet Top 10 Stories

Winners & Losers

Register for Newsletters
Top Rated Stocks Top Rated Funds Top Rated ETFs