I am a generally optimistic person, so it is depressing writing about negative things everyday. I made it a point to find a bullish stock today no matter what and I found one in the microcap bin. There is a lot to like with this company as it is in a growth industry and is posting gawdy growth numbers even in this environment. The company is called Datalink (DTLK). To learn more read on.
The company engages in the design, installation, and support of data center solutions to mid and large-size companies. It offers a suite of practice-specific analysis, design, implementation, management, and support services. DTLK is a microcap stock with a market capitalization of just $167 million.
Awesome Quarter
Datalink wowed the Street with a stellar second-quarter report. Earnings per share of 18 cents killed the estimate of just seven cents per share. Revenues grew by a solid 26% over last year. During the first six months of the year, the company saw 36 customers purchase over $1 million of its products compared to just 23 last year.
Paul Lidsky, Datalink’s president and CEO, commented, “The second quarter of 2011 was another record quarter for Datalink. Our momentum from a record 2010 and record first quarter of 2011 has continued. We reported record second quarter and six month revenues and earnings, which exceeded the investor guidance given at the beginning of the quarter. This represents our ninth consecutive quarter of non-GAAP net earnings.
I love companies that can crush earnings estimates and this is one of them. Over the past four quarters, DTLK has posted an average upside surprise north of 55%. That is the kind of growth and surprises that the Street rewards with a high multiple and a growing stock price. The balance sheet is strong with no debt and almost $2 per share in cash. The stock is trading at 15.6x forward estimates, which is a slight premium to the market, but not expensive given the strong growth prospects.I think $13 is a reasonable 12-18 month target if the company keeps executing.
A Microcap To Break Up The Gloom is an article from: 
