What analysts are saying about Datalink, Roundy's

Two local analysts cut their recommendation on Eden Prairie-based Datalink Corp. from "buy" to "hold" last week after the company missed on its first-quarter results. Chad Bennett at Craig-Hallum Capital Group and Lake Street Capital Markets analyst Eric Marti­nuzzi both downgraded the provider of enterprise data center solutions to mid- and large-size companies.

Datalink missed expectations for sales and earnings as customers delayed decisions to purchase Datalink's higher-margin storage products. Buyers have an increasing number of data storage options, including hybrid cloud and solid-state storage strategies.

In his note on the ­ratings downgrade, Martinuzzi explained the miss: "Datalink's once-crisp execution is being negatively impacted by elongated sales cycle."

Roundy's Inc. said last week that it would sell its 27 Rainbow grocery stores in Minnesota. The company has agreed to sell 18 of the stores to a consortium led by Eden Prairie-based Supervalu and Lund Food Holdings.

Milwaukee-based ­Roundy's said it would sell the nine remaining stores independently but may close some outright if no buyers can be found. Rainbow was once the second-largest grocery chain in the Twin Cities but it pulled back recently due to increased competition and had closed five Twin Cities stores in the last 16 months.

Last week's exit announcement may have been a shock to consumers, but it came as little surprise to some industry analysts. David Living­ston, a Wisconsin-based supermarket consultant, told the Star Tribune: "It was inevitable."