What happened

Shares of Extreme Networks (NASDAQ:EXTR) fell 19.5% in May 2018, according to data from S&P Global Market Intelligence. The maker of data center networking equipment delivered a weak third-quarter report and modest guidance on May 8. The stock crashed hard and hasn't recovered yet.

So what

Extreme Networks' third-quarter sales rose 76% year over year to $262 million, boosted by several strategic buyouts that closed in 2017. Adjusted earnings increased by 60%, stopping at $0.16 per share. Your average Wall Street analyst had been expecting earnings closer to $0.21 per share on sales near $268 million.

A rack of networking routers and switches, populated by a jumble of blue Ethernet cables and random adapters.

Image source: Getty Images.

Now what

The company also fell short of analysts' revenue expectations in the second quarter, triggering the start of a painful series of share price plunges. The stock is now trading roughly where it was 52 weeks ago but 41% below January's 52-week highs. Extreme Networks shareholders enjoyed a 52-week return of 180% leading up to that fateful Q2 report, but the stock is all out of momentum and verve at this point.

That being said, shares now trade at just nine times forward earnings estimates or 1.4 times trailing sales. The buyout-powered surge may have been overdone, but you could say the same thing about the negative market reaction to near-miss performances in Q2 and Q3. Opportunistic investors might want to nibble at this interesting play on the enterprise networking market.

Anders Bylund has no position in any of the stocks mentioned. The Motley Fool has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy.