Xyratex shares climb after 3Q report

SAN FRANCISCO (AP) — Shares of Xyratex Ltd. jumped Thursday after the U.K.-based data storage company reported better-than-expected third-quarter results.

Xyratex shares rose $1.07, or 11 percent, to $10.58 in midday trading.

Late Wednesday, the company said it earned $7.8 million, or 26 cents per share, in the third quarter, flat with the year-ago period. When excluding certain items, Xyratex earned 36 cents per share.

Analysts polled by Thomson Reuters, who generally exclude one-time items from their estimates, expected a profit of 14 cents.

Revenue fell 12 percent to $246.3 million from $280.8 million last year, but came in well ahead of analyst expectations for $239.2 million in sales.

Networked storage solutions products revenue fell 2 percent to $208.6 million, while storage infrastructure products sales dropped 44 percent to $37.7 million.

In a client note, Robert W. Baird&Co. analyst Jayson Noland kept his "Outperform" rating and $13 price target for the stock, calling the quarter "solid."

"The stock has moved up aggressively though valuation remains reasonable, in our view, and we continue to see longer-term upside to the shares," he wrote.