SOURCE: The Bedford Report

The Bedford Report

January 21, 2011 08:46 ET

Investors Panic in the Data Storage Sector

The Bedford Report Provides Analyst Research on Western Digital & F5 Networks

NEW YORK, NY--(Marketwire - January 21, 2011) - Shares throughout the Data Storage Industry have been hammered this week following a string of disappointing earnings reports.  Companies focused on the growth of so-called "cloud computing" had been on a tear the past year, and as Ryan Hutchinson of Lazard Capital Markets says, investors had come to expect "beat-and-raise" quarterly earnings reports -- as in beat analyst estimates, and raise guidance. The Bedford Report examines the outlook for companies in the Data Storage Devices Industry and provides research reports on Western Digital Corporation (NYSE: WDC) and F5 Networks, Inc. (NASDAQ: FFIV). Access to the full company reports can be found at:

Yesterday shares of the Seattle-based F5 Networks slipped more than 20 percent after the company posted adjusted earnings per share of 88 cents on revenues of $269 Million -- up 5 percent sequentially. The adjusted EPS actually beat consensus analyst estimates looking for earnings of 85 cents a share. F5 expects the next earnings report to contain a profit of 84 to 86 cents per share. Forward revenue guidance of $275 to 280 million missed analyst consensus of $281 million -- this was the supposed "spark" for the selloff.

F5 does extensive business with state and local governments, and due to reduced budgets in these categories, F5's revenues are expected to be crimped.

The Bedford Report releases regular market updates on the Data Storage Devices Industry so investors can stay ahead of the crowd and make the best investment decisions to maximize their returns. Take a few minutes to register with us free at and get exclusive access to our numerous analyst reports and industry newsletters.

Western Digital also saw its share price flop this week after the company said net income for the most recent quarter fell to $225 million, or 96 cents per share, from $429 million, or $1.85 a share, in the year-ago period.

Western Digital crushed analyst consensus EPS estimates, and led to an initial bump up in share price. However during the conference call that followed, management said they predict that Q1 disk drive unit shipments will total 155 million, down from 168 million last quarter.

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