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 data storage specialist NetApp (Nasdaq: NTAP) sank 13% on Thursday after its current-quarter guidance came in well below Wall Street expectations.

So what: NetApp's fourth-quarter results managed to top estimates -- adjusted EPS of $0.66 versus the consensus of $0.63 -- but a highly disappointing first-quarter outlook is forcing several analysts to cut their price targets on the stock. Specifically, weak demand in Europe and fiercer competition from giants like EMC are triggering serious concerns over NetApp's growth prospects and profitability going forward.

Now what: Management now sees first-quarter adjusted EPS of $0.34 to $0.39 on revenue of $1.4 billion to $1.5 billion, well below Wall Street's view of $0.59 and $1.6 billion. "Given the increasing uncertainty in the macro-environment and the fact that Q1 is almost always our most challenging quarter," CEO Thomas Georgens said in a conference call with analysts, "we are being particularly cautious about our Q1 guidance." Given the strong competitive and economic headwinds working against NetApp, I'd also be cautious about buying into today's pullback.

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