Extreme Networks (NASDAQ:EXTR) Stock Price Down 9.3% - Here's Why

Key Points

• Extreme Networks shares fell 9.3% on Wednesday, trading as low as $29.97 after closing at $33.02 the previous day. Trading volume was lighter than usual at about half the average daily level.
• Despite the drop, analyst sentiment remains fairly positive: six analysts rate the stock a Buy and two rate it Hold, with an average price target of $30.83. Recent ratings were mixed, including a UBS target of $28 and a Needham target increase to $26.
• The company’s latest earnings beat expectations, reporting EPS of $0.26 and revenue of $316.87 million, both above estimates. However, insiders have been selling shares, including two directors who recently reduced their holdings, and insiders sold 592,182 shares over the last quarter.

Shares of Extreme Networks, Inc. (NASDAQ:EXTR - Get Free Report) traded down 9.3% on Wednesday . The stock traded as low as $29.97 and last traded at $29.9420. 1,050,167 shares changed hands during mid-day trading, a decline of 50% from the average daily volume of 2,106,244 shares. The stock had previously closed at $33.02.

Analyst Ratings Changes

A number of analysts have commented on EXTR shares. B. Riley Financial restated a "buy" rating on shares of Extreme Networks in a research report on Thursday, April 30th. UBS Group set a $28.00 price objective on shares of Extreme Networks in a research note on Thursday, April 30th. Weiss Ratings raised Extreme Networks from a "sell (d+)" rating to a "hold (c-)" rating in a report on Monday, July 6th. Wall Street Zen raised Extreme Networks from a "buy" rating to a "strong-buy" rating in a research note on Sunday, May 24th. Finally, Needham & Company LLC boosted their price objective on Extreme Networks from $21.00 to $26.00 and gave the stock a "buy" rating in a research note on Thursday, April 30th. Six investment analysts have rated the stock with a Buy rating and two have issued a Hold rating to the stock. According to MarketBeat, Extreme Networks presently has an average rating of "Moderate Buy" and an average price target of $30.83.

Extreme Networks Stock Performance

The company has a debt-to-equity ratio of 1.89, a current ratio of 0.91 and a quick ratio of 0.78. The firm has a market capitalization of $4.02 billion, a PE ratio of 256.02, a P/E/G ratio of 2.02 and a beta of 1.77. The firm has a fifty day moving average price of $28.60 and a 200 day moving average price of $20.28.

Extreme Networks (NASDAQ:EXTR - Get Free Report) last released its earnings results on Wednesday, April 29th. The technology company reported $0.26 earnings per share (EPS) for the quarter, beating analysts' consensus estimates of $0.24 by $0.02. Extreme Networks had a return on equity of 81.88% and a net margin of 1.30%.The company had revenue of $316.87 million during the quarter, compared to analyst estimates of $311.48 million. During the same quarter in the prior year, the company earned $0.21 earnings per share. The company's revenue for the quarter was up 11.4% on a year-over-year basis. Extreme Networks has set its Q4 2026 guidance at 0.280-0.300 EPS. Research analysts anticipate that Extreme Networks, Inc. will post 0.53 earnings per share for the current fiscal year.

Insider Activity at Extreme Networks

In other news, Director Edward H. Kennedy sold 50,000 shares of the company's stock in a transaction dated Monday, May 4th. The stock was sold at an average price of $22.86, for a total value of $1,143,000.00. Following the transaction, the director owned 576,045 shares in the company, valued at $13,168,388.70. This represents a 7.99% decrease in their position. The sale was disclosed in a document filed with the Securities & Exchange Commission, which is available at this link. Also, Director Kathleen M. Holmgren sold 19,521 shares of the stock in a transaction that occurred on Friday, May 15th. The stock was sold at an average price of $24.78, for a total transaction of $483,730.38. Following the completion of the sale, the director directly owned 219,308 shares of the company's stock, valued at $5,434,452.24. This trade represents a 8.17% decrease in their ownership of the stock. The disclosure for this sale is available in the SEC filing. Over the last quarter, insiders have sold 592,182 shares of company stock worth $15,423,978. Company insiders own 3.60% of the company's stock.

Institutional Trading of Extreme Networks

A number of institutional investors have recently bought and sold shares of EXTR. Caitong International Asset Management Co. Ltd acquired a new position in Extreme Networks in the 3rd quarter worth about $31,000. Rockefeller Capital Management L.P. increased its stake in shares of Extreme Networks by 313.7% during the 4th quarter. Rockefeller Capital Management L.P. now owns 1,957 shares of the technology company's stock worth $33,000 after purchasing an additional 1,484 shares during the last quarter. CWM LLC raised its holdings in shares of Extreme Networks by 51.7% during the 4th quarter. CWM LLC now owns 3,179 shares of the technology company's stock valued at $53,000 after purchasing an additional 1,084 shares in the last quarter. Quarry LP lifted its stake in shares of Extreme Networks by 74.9% in the 3rd quarter. Quarry LP now owns 2,610 shares of the technology company's stock valued at $54,000 after purchasing an additional 1,118 shares during the last quarter. Finally, Advisors Asset Management Inc. boosted its holdings in Extreme Networks by 136.8% in the fourth quarter. Advisors Asset Management Inc. now owns 3,221 shares of the technology company's stock worth $54,000 after purchasing an additional 1,861 shares in the last quarter. Institutional investors and hedge funds own 91.05% of the company's stock.

About Extreme Networks

Extreme Networks, Inc NASDAQ: EXTR is a global provider of end-to-end networking solutions designed to support enterprise, data center, and service provider environments. The company's product portfolio encompasses high-performance wired and wireless access switches, routers, network security appliances, and software-defined networking (SDN) tools. Driven by a cloud-native management architecture, Extreme's Intelligent Edge Platform integrates network analytics, automation and orchestration capabilities to help organizations optimize performance, reduce operational complexity and strengthen security.

Since its founding in the mid-1990s and subsequent public listing in 1999, Extreme Networks has expanded its technology footprint through targeted acquisitions.

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