This Day On The Street
Continue to site
ADVERTISEMENT
This account is pending registration confirmation. Please click on the link within the confirmation email previously sent you to complete registration.
Need a new registration confirmation email? Click here

Netgear Shares Fall On Weak 2Q Report, 3Q View

NEW YORK (AP) â¿¿ Shares of Netgear dropped on Friday after the maker of networking equipment reported a smaller-than-expected rise in its second-quarter net income and offered a disappointing third-quarter forecast.

THE SPARK: Netgear said late Thursday that it expects revenue from its service provider small business unit will be down as its customers cut down on marketing programs. However, it expects its retail and commercial business units to benefit from business generated by the back-to-school season.

THE DETAILS: For the April to June period, Netgear reported net income of $21.5 million, or 56 cents per share, up from $20.6 million or 54 cents per share last year. Excluding one-costs for restructuring and other items, net income totaled 64 cents per share. That missed expectations of 68 cents per share by analysts surveyed by FactSet.

Revenue rose 10 percent to $320.7 million from $291.2 million last year. Analysts expected revenue of $323 million.

THE BACKGROUND: Started in 1996, Netgear Inc. makes products such as routers and adaptors that connect computers for homes and small businesses. The San Jose, Calif.-based company has been growing through acquisitions. During the quarter it bought an engineering company in India to enhance its small campus wireless router offerings for commercial businesses. And it bought Avaak Inc., in July, a maker of home video monitoring system.

THE OUTLOOK: Netgear predicts revenue of $310 to $325 million, while analysts expect revenue of $343.9 million.

SHARE ACTION: Shares fell $3.08, or 8.8 percent, to $31.92 in morning trading. The stock had been up 4 percent since the beginning of the year.

Copyright 2011 Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.

Check Out Our Best Services for Investors

Action Alerts PLUS

Portfolio Manager Jim Cramer and Director of Research Jack Mohr reveal their investment tactics while giving advanced notice before every trade.

Product Features:
  • $2.5+ million portfolio
  • Large-cap and dividend focus
  • Intraday trade alerts from Cramer
Quant Ratings

Access the tool that DOMINATES the Russell 2000 and the S&P 500.

Product Features:
  • Buy, hold, or sell recommendations for over 4,300 stocks
  • Unlimited research reports on your favorite stocks
  • A custom stock screener
Stocks Under $10

David Peltier uncovers low dollar stocks with serious upside potential that are flying under Wall Street's radar.

Product Features:
  • Model portfolio
  • Stocks trading below $10
  • Intraday trade alerts
14-Days Free
Only $9.95
14-Days Free
To begin commenting right away, you can log in below using your Disqus, Facebook, Twitter, OpenID or Yahoo login credentials. Alternatively, you can post a comment as a "guest" just by entering an email address. Your use of the commenting tool is subject to multiple terms of service/use and privacy policies - see here for more details.
Submit an article to us!
SYM TRADE IT LAST %CHG

Markets

DOW 18,080.14 +21.45 0.12%
S&P 500 2,117.69 +4.76 0.23%
NASDAQ 5,092.0850 +36.0220 0.71%

Partners Compare Online Brokers

Free Reports

Top Rated Stocks Top Rated Funds Top Rated ETFs