This Day On The Street
Continue to site
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

Datalink Tumbles on Stock Sale Plans

NEW YORK ( TheStreet) -- Shares of Datalink (DTLK - Get Report) fell in extended trades on Tuesday after the Chanhassen, Minn.-based data center operator announced a dilutive stock offering.

In a statement after the closing bell, Datalink said it's selling 2.2 million common shares while a selling shareholder is offering up an additional 800,000 shares.



The stock was last quoted at $5.90, down 10.3%, on light after-hours volume of slightly more than 11,000, according to Nasdaq.com. The shares closed Tuesday's regular session at $6.58, off 2.5%, on volume of 183,000.

The company said it plans to use its share of the net proceeds generated by the offering "for potential acquisitions of other businesses that will complement its current business model and growth plans." As of Dec. 31, Datalink had roughly 13.1 million outstanding common shares on a fully diluted basis.

Craig-Hallum Capital and Canaccord Genuity are acting as joint book-running managers for the offering, which is expected to price the week of March 7, according to a regulatory filing with the Securities and Exchange Commission. The filing also discloses the deal has a 15% over-allotment option, allowing for the potential sale of an additional 450,000 shares.

Although Datalink's stock has risen nearly 60% in the past year, it's seen a marked pullback since hitting a 52-week high of $9.05 on Feb. 7. In fact, it's been a volatile six months for the shares, which plumbed their 52-week low of $2.93 on Sept. 16, 2010.

Datalink reported its fiscal fourth-quarter results on Feb. 17, beating Wall Street expectations with its adjusted profit of 24 cents a share on revenue of $91 million. At current levels, Datalink shares are trading at a forward price-to-earnings multiple of a less than 10X.

-- Written by Michael Baron in New York.

>To contact the writer of this article, click here: Michael Baron.

>To submit a news tip, send an email to: tips@thestreet.com
Disclosure: TheStreet's editorial policy prohibits staff editors, reporters and analysts from holding positions in any individual stocks.

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
Only $9.95
14-Days Free
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
SYM TRADE IT LAST %CHG
DTLK $5.54 -1.07%
GOOG $619.78 0.89%
TSLA $252.88 2.10%
YHOO $31.77 0.00%
AAPL $112.75 4.70%

Markets

Chart of I:DJI
DOW 16,351.38 +293.03 1.82%
S&P 500 1,948.86 +35.01 1.83%
NASDAQ 4,749.9790 +113.8740 2.46%

Free Reports

Top Rated Stocks Top Rated Funds Top Rated ETFs