NetApp (NTAP) Struggles After Weak Guidance

Shares of NetApp (NASDAQ:NTAP) were down over 10 percent in early trading, as the company guidance was below expectations.

Craig-Hallum Capital Group analyst Eric Martinuzzi said in a note to clients, “The company is going through a personnel and capital equipment investment phase that should be good for the long term, but will weigh on near-term earnings and free cash flow leverage. Long term holders should not read too much into our downgrade, but we see the shares pausing in the near term as NetApp’s human capital growth catches up to its product growth.”

Several other brokerages downgraded the stock after the guidance as well.

While the guidance weighed on some parts of the tech sector, companies like Nvidia Corp. (NVDA), SanDisk (SNDK), Intel (INTC) and AMD (AMD) were all doing well in the trading session.

NetApp was trading at $53.72, dropping $4.82, or 8.23 percent, as of 12:18 PM EST.