SolarWinds Inc., a provider of IT management software, plunged Friday after reporting a day earlier that sales of licenses and subscriptions grew at the slowest rate in at least a year.
The shares dropped 24 percent on Friday to $35.54 a share, the biggest single-day decline since the company began trading in May 2009.
Combined sales of licenses and subscriptions for the Austin, Texas-based company increased 19 percent in the second quarter compared with the same period a year ago, well below the previous four-quarter average of 31 percent.
“It’s not in any way a reflection of the company doing poorly,” said Mandeep Singh, an analyst with Bloomberg Intelligence. “It’s just a reset of where it should be trading.”
Steven Ashley, an analyst at Robert W. Baird & Co., and Karl Keirstead, an analyst at Deutsche Bank AG, downgraded the company to neutral from buy.