QLogic Shares Plummet on Downgrade

Shares of QLogic (QLGC Quote - Cramer on QLGC - Stock Picks) fell sharply Monday after a downgrade by U.S. Bancorp Piper Jaffray analyst Ashok Kumar.

Shares of the Aliso Viejo, Calif., company recently tumbled $21.19, or about 30%, to $49.19 in morning Nasdaq trading. They closed at $70.38 on Friday's activity on the Nasdaq.

In his report, Kumar lowered the company's investment rating to neutral, citing "disappointing" third-quarter results. QLogic makes semiconductors and interfaces for network storage systems. Kumar, who also slashed his rating on Emulex (EMLX Quote - Cramer on EMLX - Stock Picks), said QLogic's stock faces a valuation compression and earnings risk. Emulex stock plunged Monday after it warned of lower third-quarter results.

Kumar also said his downgrades were influenced by the "ailing" storage industry, marked by the "disappointing performance" from Network Appliance (NTAP Quote - Cramer on NTAP - Stock Picks). Network Appliance reported third-quarter earnings on Feb. 8.