Barclays downgrades NetApp on rising competition
(Reuters) - Data storage equipment maker NetApp Inc's earnings are likely to be hit by increased competition from EMC Corp and a weakening euro, Barclays Capital said, downgrading the stock to "equal weight."
Barclays said its checks with storage buyers indicate significant interest for EMC's Isilon product line, especially the new Isilon software upgrade this fall.
Last month, NetApp forecast revenue below Wall Street expectations and its chief executive warned of uncertainty in Europe.
"Macro and competitive pressures actually represent a larger percentage of NetApp's guidance and expect downside to current consensus estimates," analyst Ben Reitzes wrote in a note to clients.
Analyst Reitzes is rated four stars by Thomson Reuters StarMine for the accuracy of his earnings estimates on the companies under his coverage.
A sizeable amount of NetApp's sales come from Europe, where a debt crisis has shaken confidence in the economy and policy-makers fear Greece could pull out of the euro zone.
The SunnyVale, California-based company's shares closed at $31.31 on Thursday on the Nasdaq.
(Reporting by Shubham Singhal in Bangalore; Editing by Tenzin Pema and Don Sebastian)