Radware volatility rises

RADWARE’s price swings have swollen to the highest since 2011 on concern the Israeli maker of network technology will post the slowest annual sales growth in seven years.

RADWARE’s price swings have swollen to the highest since 2011 on concern the Israeli maker of network technology will post the slowest annual sales growth in seven years.

Shares tumbled 23% to $29.07 in New York on Friday, the steepest slump since 2004, after the company reported first-quarter profit that was at least 10c per share below its forecast. The stock’s 60-day volatility quadrupled from a record low to 55.95, according to data. Radware led declines on the Bloomberg Israel-US Equity index, which had the biggest drop since November last week.

Radware’s $45m revenue in the first three months of the year was also below projections as sales from China and the Europe, Middle East and Africa region declined, the Tel Aviv- based company said on Friday.

The Chinese economy emerged from an almost twoyear slowdown last quarter, while Europe is in recession. Analysts predict sales for Radware, whose products help boost network efficiency, will rise 6% this year, the slowest pace of growth since 2006.

“They came into the year with a soft portfolio of activity,” Alex Henderson, an analyst at Needham in New York said on Friday. “Radware noted difficulty closing existing customer add-on deals. They are confident they will get business over the course of the year.”

Radware’s trading volume was 20 times the three-month average on Friday as the stock had the biggest loss among the 130 companies on the Nasdaq Telecommunications index. The shares are trading at 15.7 times estimated earnings, or 38% below its five-year average, data showed. Bloomberg