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NetApp Could Give Tech a Pick-Me-Up

SUNNYVALE, Calif. ( TheStreet) -- The tech sector's ongoing recovery may get a shot in the arm later today when storage specialist NetApp (NTAP) reports its eagerly anticipated first-quarter results.

The Sunnyvale, Calif.-based firm, which recently lost out to rival EMC (EMC) in the battle to acquire Data Domain (DDUP) has been attracting plenty of attention recently.

Seen as a rising star of the hardware sector, the company's high-growth profile has endeared it to analysts and investors alike.

"Demand appears to have stabilized and NetApp continues to focus on reducing costs and protecting margins," wrote Bill Choi, an analyst at Jefferies & Company, in a note released this week. "Recent run-up in NetApp's share price largely reflects these positive trends."

NetApp's shares have climbed more than 60% this year, underlining the company's growing status in the tech space. Widely regarded as one of the hottest stocks in the vibrant storage space, NetApp has averaged 28% growth in the last five years, and has repeatedly been touted as M&A bait.

Archrival EMC may have set the tone for NetApp's quarter, recently beating analysts' second-quarter estimates. The storage giant's sales increased more than 3% sequentially, raising hopes for NetApp at a time when investors are desperate for signs of a rebound.

"Almost every large tech company has indicated that order trends are improving quarter-over-quarter and month-over-month," wrote Kaushik Roy, an analyst at Wedbush Morgan, in a recent note. "Revenues from Netapp's biggest Other Equipment Manufacturer (OEM) partner in Europe, Fujitsu, should be up materially quarter-over-quarter as things are settling down."

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