The bleak economic forecast is causing plenty of worry in the tech sector. While companies like IBM and Intel recently reported profitable quarters, Sun just posted nearly 1.7 billion in losses amid declining sales. Meanwhile, SGI seems permanently stuck in reverse, continuing its perfect streak of losing quarters since emerging from Chapter 11 in 2006.

Notwithstanding SGI’s woes, the conventional wisdom is that the HPC sector will be a bright spot in the industry, due to the strategic importance of high-end computing to government and commercial R&D. Providing some credence to that viewpoint, Cray just posted a modest $5 million net income for the third quarter. A profitable 2008 is within reach for the iconic supercomputer maker if Oak Ridge National Laboratory accepts its new XT5 petaflop machine before the end of the year.

But the real hot spot in HPC may be in storage. High-end storage vendor DataDirect Networks is reporting an annual growth rates north of 30 percent, which it expects to maintain for the foreseeable future. With a history of positive cash flow and operating margins in the “high teens,” the company is ripe for public offering. In fact, it’s been angling for an IPO for over a year now.

Currently though, the markets aren’t cooperating. According to Steve Zivanic, DataDirect’s VP of corporate communications, they’re waiting for the optimum timing, since they’re not interested in taking a 30 to 40 percent haircut on the company’s valuation. “Basically, we were all set to go earlier this year, and then the markets really took a turn for the worse about the time of the Lehman Brothers collapse,” he told me.

The New York Times reports that IPOs have been tough to come by this year. So far, only two tech companies went public in 2008 compared to 48 in 2007. With the lack of IPO turnover, venture capitalist money has been tied up in existing investments, leaving less to spread around to other companies.

DataDirect seems well situated to ride this out. For one thing, it doesn’t have VC investors, so no one is breathing down its neck looking to cash out. At this point, the company is privately owned by the two co-founders, CEO Alex Bouzari and the president, Paul Bloch. As long as DataDirect maintains a profitable trajectory, it can afford to bide its time until the market settles down.

DataDirect also benefits by being in the right business. Not only is storage a hot market, but the company’s core constituency — supercomputing and media/entertainment – is nearly recession-proof. More than 40 percent of the company’s revenue (which totaled $100 million in 2007) is derived from HPC customers: government labs, universities, and oil and gas companies. With organizations like LLNL, ORNL, NASA, Saudi Aramco, and Total using its gear, DataDirect doesn’t have to worry that its customers will run out of money.

According to Zivanic, another 35 percent of the company’s revenue comes the media/entertainment industry, which includes Web-based video games, online video streaming, and massively-scaled, Web-based photo libraries. Like HPC, these applications rely on high-capacity, high performance storage. Here DataDirect has attracted big names like AOL, CNN and Kodak. Shutterfly (an online social expression and personal publishing service) alone has acquired 13 petabytes of DDN storage.

In lieu of a public offering, DataDirect could be acquired by another storage vendor or system OEM. The OEM route seems less likely, but I wouldn’t be surprised if acquisition-happy EMC made a play for it. EMC has nearly $6 billion in cash and DDN would only set it back a few hundred million. But in this kind of economic climate, most companies are looking to pick up some bargains and DDN doesn’t fall into that category.

Perhaps a more interesting HPC storage buy would be Panasas. Although the company owns impressive technology, the storage vendor has never threatened an IPO. This summer — before the financial meltdown – the company secured its fifth round of VC funding. But just this week, Panasas confirmed it has laid off an unspecified number of employees. Spokesperson Ursula Herrick, characterized the number of workers let go as “not significant,” and said the move was done proactively to keep the company healthy. According to her, the layoffs took place mostly in satellite offices and admin positions.

At this point though, a lot of the company’s intrinsic value lies in its IP and human talent, so an acquisition by a bigger brand could make a lot of sense. And since Panasas has been a leader in developing parallel NFS (pNFS) technology, any storage vendor looking to make a big push with pNFS should take a hard look at this company. Whether the Panasas investors would entertain a buyout is anyone’s guess.