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NetApp, Inc.

5/25/2013, 10:51 PM ET

Quote & Headlines Market Currents StockTalk

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Thursday, May 23, 3:11 PM Chatter says trading desks are busy with corporate buyback activity today as CFOs take advantage of a little selling to put repurchase plans into action. AAPL is the gorilla, having bumped its authorization to $60B from $10B. Others of note include: LyondellBasel (LYB), Merck (MRK) - which just entered an accelerated repurchase program, NetApp (NTAP), Northrop Grumman (NOC), Macy's (M), and Delta (DAL). There's also IBM - long with a reputation for issuing debt at lows in yield. Is their equity timing as good? 6 Comments
Wednesday, May 22, 12:02 PM Several brokerages raise their price targets on NetApp (NTAP +2.7%) after the storage systems maker launched its first-ever dividend and ramped up its buyback program. But nobody's rushing in with Buy ratings either; while praising the shareholder moves, Wedbush says it's "cautious on the spending environment" and isn't buying "until signs of sustainable growth and visibility into the business emerge." Comment! [Tech, On the Move]
Wednesday, May 22, 9:17 AM Premarket gainers: ZLC +30%. MBND +24%. CLNT +23%. SKS +18%. ONCY +10%. BIOF +9%. TOL +6%. NTAP +6%. YGE +5%. GALE +5%.
Losers: STP -9%. NBG -7%. BALT -9%. UAN -6%. Comment! [On the Move]
Tuesday, May 21, 7:26 PM "We commend the positive steps taken by NetApp (NTAP) today" says Elliott Associates portfolio manager Jesse Cohn in response to news the enterprise storage giant has more than doubled its buyback authorization to $3B (with plans to buy aggressively), initiated a $0.15/share dividend (with plans to increase it), and is planning to cut ~900 jobs. Cohn adds Elliott, an activist investor, owns ~16M NetApp shares (good for a 4.3% stake), and looks forward to "the company's continued commitment to creating shareholder value." Shares +2.7% AH. (previous) 1 Comment [Tech]
Tuesday, May 21, 6:00 PM After-hours top gainers, as of 5:30 p.m.: SKS +18.1%. DY +12.4%. NSPR +3%. NTAP +2.5%. WIT +2.4%.
After-hours top losers: YY -6.5%. UAN -5.1%. BZH -2.5%. YGE -1.9%. ADI -1.9%. Comment! [On the Move]
Tuesday, May 21, 4:30 PM More on NetApp: $1B in buybacks promised over next 4 months, $2B over next 12 months; FQ4 buybacks totaled $180M. Company is cutting 900 jobs (~7% of workforce) in restructuring (Piper predicted 1,300), expects to take $50M-$60M in pretax charges. NetApp claims "double-digit growth in branded bookings," which suggests OEM sales (to IBM?) are weak. FQ4 product revenue (66% of total) -2% Y/Y, software/maintenance +6%, services +8%. Gross margin was 61.2%, +160 bps Y/Y. FQ1 guidance likely to stoke share loss worries. NTAP +2.1% AH. (PR) 1 Comment [Tech, Earnings]
Tuesday, May 21, 4:08 PM NetApp (NTAP): FQ4 EPS of $0.69 beats by $0.01. Revenue of $1.72B (+1% Y/Y) misses by $40M. Expects FQ1 revenue of $1.475B-$1.575B and EPS of $0.45-$0.50, below consensus of $1.6B and $0.53. Initiates $0.15/share quarterly dividend (1.6% yield) with intention to increase over time. Increases buyback authorization by $1.6B to $3B. Shares +3.3% AH. CC at 5:30PM ET (webcast). (PR) Comment! [Tech, Earnings, On the Move, Breaking News]
Tuesday, May 21, 12:10 AM Notable earnings after Tuesday’s close: NTAP,ADI, CPWR, INTU, Comment! [Earnings]
Monday, May 20, 5:35 PM Notable earnings after Tuesday’s close: NTAP,ADI, CPWR, INTU, Comment! [Earnings]
Monday, May 20, 12:49 PM Baird's Jayson Noland downgrades NetApp (NTAP -1.8%) to Underperform ahead of tomorrow's FQ4 report, citing share losses to EMC and others. Noland: "We are not advocating a short position ... due to the possibility of a positive investor reaction to opex rationalization or shareholder friendly use of cash ... We do recommend investors take profits." EMC has "outperformed NetApp" in Baird's reseller checks since Q3 '11, something Nolan attributes to the launch of EMC's VNX mid-range systems, more innovative products, and "increased channel friendliness." He also notes NetApp has been slow to roll out all-flash storage systems. Comment! [Tech, On the Move, Quick Ideas]
Thursday, May 16, 7:21 PM Goldman is working with NetApp (NTAP) to explore options, Bloomberg reports in an updated version of its story about Elliott Associates' stake. Not surprisingly, Elliott is said to be pushing NetApp to return cash, and to be proposing a new director slate. NetApp ($13.9B market cap) had $6.7B in cash/investments on its balance sheet as of Jan. 24, and $2.2B in debt. The company doesn't pay a dividend. Piper believes NetApp is planning to cut 1,300 jobs (~10% of its workforce) in underperforming areas such as its Engenio high-performance storage unit (acquired in 2011 from LSI). Shares +1.6% AH after jumping 6.1% in regular trading. 3 Comments [Tech]
Thursday, May 16, 12:07 PM NetApp (NTAP +7.1%) soars on a report activist firm Elliott Associates has taken a sub-5% stake (could grow larger in time) in the company, and is pushing it to "change its board and study options to boost shareholder value." Elliott is fresh off a successful push to get BMC Software to sell itself. The news comes ahead of NetApp's Tuesday FQ4 report. (dealReporter) Comment! [Tech, On the Move]
Wednesday, May 15, 1:23 AM IDC cuts its 2013 IT spending growth forecast to 4.9% from 5.5%, citing macro issues and weak PC demand; 2012 growth was 5.6%. Gartner, which includes a bigger array of products/services in its numbers, forecast 4.1% growth last month. IDC now sees U.S. software spending (MSFT, ORCL) growing 6%, down from a prior 7%. Storage hardware revenue (EMC, NTAP) is only expected to grow 2.4%, down from 2012's 6.1%, and carrier spending on networking gear (CSCO, JNPR, ALU, CIEN) is expected to grow just 1.1% vs. 5.8% in 2012. Recent earnings reports and warnings (I, II, III, IV) help explain the subdued outlook. 2 Comments [Tech]
Monday, May 13, 4:14 PM NetApp (NTAP -0.2%) spiked a bit before the close after dealReporter stated an activist investor is engaging the company. The report follows a Piper note indicating the company is planning to cut 10% of its workforce. FQ4 results arrive on May 21. Comment! [Tech]
Saturday, May 11, 2:22 PM EMC showed off plenty of new software at its EMC World conference, but was light on hardware news. In addition to its ViPR storage management platform, EMC unveiled: 1) An OS update for its Isilon scale-out NAS systems (competes with NTAP) that adds support for data deduplication and the Hadoop big data framework. 2) A Data Protection Suite (competes with SYMC and CVLT) that ties together existing backup/archive software, while allowing for more flexible licensing. 3) The addition of hybrid cloud support for its Syncplicity cloud file-syncing platform. EMC wants to make clear it won't get left behind as a growing amount of storage industry value shifts to software, with much of it residing on servers rather than storage arrays. 1 Comment [Tech]
Tuesday, April 23, 10:20 AM Storage/hard drive stocks are outperforming, possibly aided by Veeco's Q1 bookings numbers: the company reported hard drive equipment bookings totaled $27M, down 7% Y/Y but up 60% Q/Q in spite of slumping PC demand. Veeco added on its CC (transcript) hard drive customers are "starting to make selective technology buy decisions" once more. STX +2.6%. WDC +2.6%. EMC +1.8%. NTAP +2.7%. XRTX +1.6%. QTM +5.1%. EMC reports tomorrow morning. Also, LED/solar equipment makers Aixtron (AIXG +9%) and GT Advanced (GTAT +2.7%) are getting a lift from Veeco's numbers and bullish Q2 commentary. 2 Comments [Tech, On the Move]

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