Shares of Santa Ana’s STEC Inc., a maker of flash memory drives for corporate and industrial uses, soared Thursday on what seems to be bullish expectations by investors.
The stock closed up 15% to a market value of $690 million.
Buyers of STEC’s call options, which are bets that a stock’s value will rise, struck some 25,000 contracts on Thursday. That’s compared to some 9,000 put options, or bets the stock will fall.
It’s not entirely clear why STEC’s shares jumped, but the volume of call options could signal a bullish outlook by investors.
It’s a marked change from the pattern of the past eight months, which has seen the company’s shares plummet over concerns about competition and slowing sales of STEC’s drives that use flash memory chips instead of spinning disks to store huge amounts of data for banks and retailers.
In September, STEC gave a conservative outlook for the fourth quarter and hinted that its top customer, EMC Corp. had a stockpile of drives and would slow its ordering.
Analyst downgrades and a flurry of shareholder lawsuits followed.
The news sent shares plummeting and STEC lost two-thirds of its value by the end of 2009.
STEC’s shares are off 37% since the start of the year.
