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NetApp (NTAP) Set to Acquire Instaclustr, Terms Undisclosed

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NetApp (NTAP - Free Report) recently inked an agreement to acquire Instaclustr for undisclosed financial terms. The acquisition is subject to customary conditions and is expected to close in the company’s first-quarter fiscal 2023.

Instaclustr provides open-source database, pipeline and workflow applications delivered as a service. The integration of Instaclustr’s fully-managed database and data pipeline services along with NTAP’s can storage and compute optimization capabilities will provide clients with a comprehensive Cloud Operations platform.

The platform would offer clients with an improved foundation for their applications in the public cloud and on-premises environments. Instaclustr will be a part of the company’s Spot by NetApp portfolio of solutions.

NetApp, Inc. Price and Consensus

 

NetApp, Inc. Price and Consensus

NetApp, Inc. price-consensus-chart | NetApp, Inc. Quote

 

NetApp Focuses on Acquisitions to Boost Spot Portfolio

The latest acquisition is complementary to NetApp’s recent acquisition of CloudCheckr, Data Mechanics, Fylamynt and Spot. NetApp stated that these acquisitions have made Spot by NetApp a comprehensive platform for CloudOps.

NetApp acquired cloud services startup –– Spot –– in July 2020. The acquisition of Spot bolstered NetApp’s Application Driven Infrastructure capabilities. Spot’s compute platform provides customers with solutions that help optimize workloads while maintaining service-level objective (SLO) and service-level agreement (SLA). 

To further strengthen Spot by NetApp, the company acquired Data Mechanics in June 2021. Data Mechanics is a managed platform that enables clients to easily run Apache Spark on Kubernetes. The acquisition will help NetApp develop its latest Spot Wave offering.

CloudCheckr buyout is enabling NetApp to bolster the Spot by NetApp FinOps solutions. CloudCheckr is a cloud optimization platform that helps enterprises gain enhanced visibility regarding their cloud operations as well as extend tight security to the same along with cost reduction and cloud resource optimization.

In February 2022, NetApp purchased Fylamynt for an undisclosed amount. The integration of Fylamynt’s suite of cloud automation technologies with Spot by NetApp will aid enterprises to rapidly deploy Spot by NetApp services within their existing cloud environments. The amalgamation of Fylamynt’s pre-built integrations with Spot’s full CloudOps portfolio will help customers accelerate, optimize and automate every part of the cloud operations workflow.

The buyout of Instaclustr marks the latest effort by NetApp to boost its Spot portfolio, as the company aims to generate a $2-billion annual recurring revenue by fiscal 2026. In the last reported quarter, Public Cloud Services recorded annualized recurring revenues (ARR) of $469 million, up 98% year over year.

NetApp exited the quarter ending Jan 28, 2022, with $4.2 billion in cash, cash equivalents and investments, whereas long-term debt stood at $2.4 billion.

At present, NetApp carries a Zacks Rank #3 (Hold). Shares of NTAP have gained 6.6% against the industry’s fall of 8.4% in the past year.

Key Picks

Some better-ranked stocks from the broader technology sector are Broadcom (AVGO - Free Report) , Apple (AAPL - Free Report) and Arrow Electronics (ARW - Free Report) . All stocks carry a Zacks Rank of 2 (Buy) at present. You can see the complete list of today’s Zacks #1 (Strong Buy) Rank stocks here.

The Zacks Consensus Estimate for Broadcom’s fiscal 2022 earnings is pegged at $35.49 per share, up 7.4% in the past 60 days. AVGO’s long-term earnings growth rate is pegged at 14.5%.

Broadcom’s earnings beat the Zacks Consensus Estimate in all the preceding four quarters, with the average being 1.9%. Shares of AVGO have increased 24.3% in the past year.

The Zacks Consensus Estimate for Apple’s fiscal 2022 earnings is pegged at $6.16 per share, up 0.2% in the past 60 days. The long-term earnings growth rate is pegged at 12.5%.

Apple’s earnings beat the Zacks Consensus Estimate in each of the last four quarters, with the average being 20.3%. Shares of AAPL have rallied 29.4% in the past year.

The Zacks Consensus Estimate for Arrow Electronics 2022 earnings is pegged at $18.48 per share, up 4.5% in the past 60 days. The long-term earnings growth rate is 3.1%.

Arrow Electronics’ earnings beat the Zacks Consensus Estimate in each of the last four quarters, with the average being 19.1%. Shares of ARW have lost 3.6% in the past year.


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