QLogic Corporation (NASDAQ:QLGC)
QLogic Corporation (QLGC), a server and storage networking company yesterday announced that they are being bought out by chipmaker Cavium Inc. in a deal worth approximately $1.36 billion.
QLogic and Cavium CEO’s Comments
“QLogic with Cavium is a winning combination for customers and employees and is financially compelling for QLogic shareholders,” said Christine King, Executive Chairman of QLogic. “The scale of operations of a nearly $1 billion revenue business will allow the combined company to deliver better solutions for customers and create more career opportunities for employees. Shareholders will benefit from both the immediate premium, as well as the opportunity to participate in the long-term value creation from the combined company’s strong growth prospects.”
“Today’s acquisition of QLogic is highly complementary and strategic to Cavium and it creates a diversified pure-play infrastructure semiconductor leader,” stated Syed Ali, President and Chief Executive Officer of Cavium. “QLogic’s industry leading products extend our market position in data center, cloud and storage markets, and further diversifies our revenue and customer base. In addition to the compelling strategic benefits, the manufacturing, sales and operating synergies will create significant value for our shareholders.” Business Wire
QLGC Technical Analysis
QLGC opened trading yesterday at $13.68 which was up from the previous days trading of $13.67. QLGC closed trading yesterday at $13.54 and spiked up after market to $15.15, equivalent to a 12% increase from the closing price. Taking a look at the daily chart we can see the last time QLGC traded below these levels was on June 25th, 2014 when it traded at $15.27 . Taking a closer look at the daily chart we can see that QLGC has been on a upward trend dating back to May 5th when it traded at $11.78. QLGC has a float of 82.80 million shares and traded 1.70 times the normal daily trading volume on Wednesday. For trading purposes, I would like to see QLGC open trading on Thursday above $14.60 and if it does I would be looking to take a long position at the bell. My stop loss would be $0.15 from my entry position fearing anything more than that and the stock would start to fill in the gap up.
Company Profile
QLogic Corporation and its subsidiaries design and supply high performance server and storage networking connectivity products that provide, enhance, and manage computer data communication. Its products facilitate the transfer of data and enable resource sharing between servers, networks, and storage. The company offers advanced connectivity platforms comprising adapters and application-specific integrated circuits for server and storage connectivity applications; and legacy connectivity products consisting of fiber channel switch products. Its products are used in enterprise, managed service provider, and cloud service provider data centers, and other environments. The company sells its products to original equipment manufacturers and distributors worldwide. QLogic Corporation was founded in 1992 and is headquartered in Aliso Viejo, California.