Internap Corporation (NASDAQ:INAP) Why it Popped

Internap Corporation (NASDAQ:INAP)

Internap Corporation (NASDAQ:INAP) were up over 150% in early trading on over 10 times their pro-rated average daily volumes. The catalyst was an announcement of a private placement of approximately 23.8 million shares of its common stock at a price of $1.81 per share, for aggregate gross proceeds of approximately $43 million. Internap plans to use the funds, partly, to help pay down its debt.

Peter D. Aquino, President and Chief Executive Officer of Internap Corporation (NASDAQ:INAP) stated “The speed with which our new team is moving to right-size our business and invest in sales and marketing to capture strong market demand for Colocation and Cloud services is impressive.  The next steps in the 2017 transformation of the new INAP is to approach the market as two pure plays, complete our debt refinancing, and begin to consider strategic opportunities to bolster our organic growth.”

Atlanta, GA-based Internap Corporation (NASDAQ:INAP) provides internet infrastructure through both Colocation Business and Enterprise Services, and Cloud, Bare-Metal Servers, and SMB iWeb platforms. INAP’s global high-capacity network connects 15 company-controlled Tier 3-type data centers in major markets in North America, 34 wholesale partnered facilities, and points of presence in 26 central business districts around the world.

Investor confidence was also buoyed by guidance provided today. Internap Corporation (NASDAQ:INAP) affirmed guidance for 2016 – revenue of $297 million to $300 million, adjusted EBITDA of $81 million to $83 million, and capital expenditures of $47 million to $50 million. Guidance for 2017 was revenue of $275 million to $285 million, adjusted EBITDA of $84 million to $87 million and capital expenditures of approximately $42 million.

Sales for Internap Corporation (NASDAQ:INAP)trended up from 2011 ($244.6 million) to 2014 ($335 million) but in 2016 the company posted a lower sales figure of $318.3 million. There has been no break in the EPS trend – it has been downward. In 2011 the company posted an EPS loss of $0.03) and in 2015 the loss expanded to $0.93. Six firms follow Internap Corporation (NASDAQ:INAP). Two rate INAP as a “Strong Buy”, one rates the shares a “Buy” and three rate INAP as a “Hold”.

I have no positions in any stocks mentioned, and no plans to initiate any positions within the next 96 hours. All information, or data, is provided with no guarantees of accuracy.

About the author: Marc has a degree in economics and a MSc. in Finance. Over his 20 year career, Marc has worked for global investment firms in Europe and the United States as an analyst, fund manager, and consultant.

2/22/2017
Ticker Symbol INAP
Last Price a/o 11:15 AM EST  $                      2.50
Average Volume                    830,250
Market Cap (mlns)  $                  104.22
Sales (mlns) $302.90
Shares Outstanding (mlns) 57.58
Share Float (mlns) 54.99
Shortable Yes
Optionable Yes
Inside Ownership 4.20%
Short Float 5.91%
Short Interest Ratio 3.91
Quarterly Return 67.59%
YTD Return 17.53%
Year Return -9.50%