Although we don't believe in timing the market or panicking over market movements, we do like to keep an eye on big changes -- just in case they're material to our investing thesis.
What: Shares of Silicon Graphics International
So what: Today's move lower appears to be tied to the weakness we are seeing in Japan. Silicon Graphics purchased SGI of Japan last month for $17.9 million in an all-cash deal. The purchase was made to allow Silicon Graphics to get its foot in the door of Japan's technical computing market, but the tragic earthquake one month ago will likely cripple SGI's revenue stream for some time to come.
Now what: Following an enormous earnings beat in February, Silicon Graphics stock has been on a tear -- rising 137% during the first-quarter. It only seems reasonable that the stock is pulling back today on the fear that it will need to once again revise its revenue and profit expectations. I say "once again" because it lowered its revenue forecast after it purchased SGI of Japan in March. It's a little early to throw in the towel on Silicon Graphics, but following warnings from Micrel
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