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NetApp Shines in an Underperforming Industry

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Aug. 18 2020, Updated 6:10 a.m. ET

Technology, Hardware, and Storage subsector

The Technology, Hardware, and Storage subsector generated returns of -0.97% in the last week, compared with 0.69% for XLK. As a whole, the subgroup is trending down due to lower demand for computers. Firms in this industry include SanDisk (SNDK), Western Digital (WDC), and Hewlett-Packard (HPQ), providing investor returns of -3.30%, -2.14%, and -1.88%, respectively. In contrast, NetApp has weekly positive returns of 1.34%.

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NetApp (NTAP) has seemingly broken out of the trading range as the market received the news of its expansion of its all-flash storage array line, targeted at enterprise users. All-flash storage can dramatically improve application performance and improve server efficiency. As more businesses increase their reliance on flash-optimized platforms, firms such as NetApp that offer an array of flash-optimized platforms will benefit.

Out of the seven stocks in the Technology, Hardware, and Storage subsector, five stocks generated negative returns, and two stocks generated positive weekly returns.

Moving averages

Sandisk’s closing price on Friday, June 19, was $63.92. It is currently trading -12.15% below its 100-day moving average, -5.25% below its 50-day moving average, and -4.30% below its 20-day moving average.

The closing price of Western Digital was $91.02, and the stock was trading -7.72% below its 100-day moving average, -5.4% below its 50-day moving average, and -3.47% below its 20-day moving average.

Hewlett-Packard is trading -6.20% below its 100-day moving average, -3.90% below its 50-day moving average, and -3.54% below its 20-day moving average.

NetApp is currently trading -6.14% below its 100-day moving average and -2.52% below its 50-day moving average, but 1.51% above its 20-day moving average.

Analyst recommendations

Out of the 265 analyst recommendations covering seven stocks in this sub-industry, 143 analysts have a “buy” recommendation, 15 have a “hold” recommendation, and 107 have a “sell” recommendation. Sandisk has 19 sell recommendations, compared with 14 buy recommendations. Similarly, NetApp has 27 sell recommendations and five buy recommendations.

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