Here’s Why Data Storage Stocks Are Getting Ripped Now
Quick answer: Brocade Communications Systems (NASDAQ:BRCD) is getting sold off like its yesterday, down over 28% at last check after it reported second quarter earnings this morning. The company lowered its outlook for the third fiscal quarter, and now projects revenues of $500M-$505M and per share earnings of $0.08-$0.09, below a consensus of $550.9M and $0.11. Investors are feeling increasingly jittery about data storage stocks as the latest results from sector leaders Cisco (NASDAQ:CSCO) and Juniper Networks (NYSE:JNPR) were also disappointing. Analysts believe that Brocade’s lower estimates for the third quarter, which it attributed to soft demand and inventory reductions, may signal a slowdown in corporate IT spending.
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Data storage stocks are responding sensitively to the news, have a look at:
EMC Corporation (NYSE:EMC): -1.06%, NetApp Inc. (NASDAQ:NTAP): -3.33%, Western Digital Corp. (NYSE:WDC): -0.62%, Brocade Communications (NASDAQ:BRCD) -28.22%, QLogic Corporation (NASDAQ:QLGC): -2.52%, Emulex Corp (NYSE:ELX): 0.00%, and Overland Storage Inc. (NASDAQ:OVRL): -3.79%.