Why Netgear Shares Plunged (NTGR)

Why Netgear Shares Plunged

Although we don't believe in timing the market or panicking over market movements, we do like to keep an eye on big changes -- just in case they're material to our investing thesis.

What: Shares of Netgear (Nasdaq: NTGR ) plunged by as much as 18% today before recouping most of those losses after the company reported earnings.

So what: The maker of gear for the Internet put up second-quarter sales of $320.7 million, a little shy of investors' expectations of $323.6 million. The same story panned out down below, posting adjusted earnings per share of $0.64 compared to the consensus of $0.69.

Now what: Guidance was also gloomy, with third-quarter revenue expected to be $310 million to $325 million, the high end of which still falls short of the analyst estimate of $344.2 million. CEO Patrick Lo cited the macroeconomic situation in Europe but said the business is seeing strong growth in Asia-Pacific. Netgear also recently closed two smaller acquisitions, an engineering company in India and privately held AVAAK.

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Report this Comment On July 28, 2012, at 6:56 PM, FoolSolo wrote:

Netgear came in a little light of expectations, but still grew revenues by 10.1% YoY. That certainly doesn't justify an 18% selloff.
The fools (small "f") that sold in the morning likely regretted it by afternoon as the stock bounced back to nearly where it was before the earnings report.
That presented a great opportunity to pick-up shares of this great company, or add to your existing position. If you have plenty of Netgear shares then dips like this are great for writing puts to generate income.

updated 1 day ago Sponsored by:
	DOW	15,354.40	121.18	0.80%
	S&P 500	1,667.47	17.00	1.03%
	NASD	3,498.97	33.73	0.97%

NTGR	$32.95		+0.41	+1.26%
Netgear		CAPS Rating:

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Why Netgear Shares Plunged

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Report this Comment On July 28, 2012, at 6:56 PM, FoolSolo wrote:

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