Back to top

Bull of the Day: NetApp (NTAP)

Read MoreHide Full Article

Founded in April 1992 and headquartered in Sunnyvale, CA, NetApp (NTAP - Free Report) provides enterprise storage and data management software and hardware products and services.

The company offers cloud data services, data storage software, data backup and recovery, all-flash storage, converged systems, data infrastructure management, and hybrid flash storage.

Strong Results

The company reported strong results for its fiscal fourth-quarter 2018 ended April 27, 2018. Non-GAAP earnings of 1.05 per share were ahead of the Zacks Consensus Estimate of $1.01 per share. Earning surged 22.1% year-over-year and were also above the management’s guidance.

Revenues were up 11% from the year-ago quarter, and also beat the Zacks Consensus Estimate.

“The fourth quarter marked a great finish to a strong year. We successfully pivoted to the growth areas of the market, expanded our opportunity with HCI and new cloud partnerships, and improved operational discipline to deliver sustained and profitable growth,” said the CEO.

Rising Estimates

After a strong quarterly report, analysts have significantly raised their estimates for the company.

Zacks Consensus Estimates for the current and the next fiscal year have increased to $4.06 per share and $4.75 per share respectively, from $3.97 per share and $4.62 per share, before the results. 

Returning Cash to Shareholders

During fiscal year 2018, the company returned $3.97 million to shareholders through share repurchases and cash dividends. It amounted to 76% of free cash flow.

Earlier, the company announced that it will double its quarterly dividend to $0.40 per share in Q1 of FY 2019. The quarterly dividend will be paid on July 25, 2018.

Bottom Line

The stock is up almost 50% this year, but trading at about 20 times forward earnings, it does not look too expensive and with expected EPS growth rate of 13.84%, it can continue its upward trend. In this data driven economy, the demand for its products may continue to rise.

The stock currently has a Zacks Rank #1 (Strong Buy). It has Zacks Style Scores of “A” for Growth, “B” for Momentum and a VGM Score of “B”.

Today's Stocks from Zacks' Hottest Strategies

It's hard to believe, even for us at Zacks. But while the market gained +21.9% in 2017, our top stock-picking screens have returned +115.0%, +109.3%, +104.9%, +98.6%, and +67.1%.

And this outperformance has not just been a recent phenomenon. Over the years it has been remarkably consistent. From 2000 - 2017, the composite yearly average gain for these strategies has beaten the market more than 19X over. Maybe even more remarkable is the fact that we're willing to share their latest stocks with you without cost or obligation.

See Them Free>>

In-Depth Zacks Research for the Tickers Above

Normally $25 each - click below to receive one report FREE:

NetApp, Inc. (NTAP) - free report >>

More from Zacks Bull of the Day

You May Like