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NetApp (NTAP) Falls More Steeply Than Broader Market: What Investors Need to Know

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In the latest trading session, NetApp (NTAP - Free Report) closed at $105.27, marking a -1.08% move from the previous day. This change lagged the S&P 500's 0.33% loss on the day. Meanwhile, the Dow lost 0.63%, and the Nasdaq, a tech-heavy index, lost 0.22%.

Heading into today, shares of the data storage company had gained 3.38% over the past month, lagging the Computer and Technology sector's gain of 5.24% and the S&P 500's gain of 4.07%.

Analysts and investors alike will be keeping a close eye on the performance of NetApp in its upcoming earnings disclosure. The company's earnings per share (EPS) are projected to be $1.54, reflecting a 1.28% decrease from the same quarter last year. Our most recent consensus estimate is calling for quarterly revenue of $1.54 billion, down 0.15% from the year-ago period.

Looking at the full year, the Zacks Consensus Estimates suggest analysts are expecting earnings of $7.72 per share and revenue of $6.74 billion. These totals would mark changes of +6.48% and +2.58%, respectively, from last year.

It is also important to note the recent changes to analyst estimates for NetApp. Such recent modifications usually signify the changing landscape of near-term business trends. As a result, upbeat changes in estimates indicate analysts' favorable outlook on the business health and profitability.

Our research reveals that these estimate alterations are directly linked with the stock price performance in the near future. To capitalize on this, we've crafted the Zacks Rank, a unique model that incorporates these estimate changes and offers a practical rating system.

The Zacks Rank system, which varies between #1 (Strong Buy) and #5 (Strong Sell), carries an impressive track record of exceeding expectations, confirmed by external audits, with stocks at #1 delivering an average annual return of +25% since 1988. Over the last 30 days, the Zacks Consensus EPS estimate has moved 0.48% lower. NetApp presently features a Zacks Rank of #3 (Hold).

Looking at its valuation, NetApp is holding a Forward P/E ratio of 13.78. Its industry sports an average Forward P/E of 13.78, so one might conclude that NetApp is trading at no noticeable deviation comparatively.

Investors should also note that NTAP has a PEG ratio of 1.97 right now. This popular metric is similar to the widely-known P/E ratio, with the difference being that the PEG ratio also takes into account the company's expected earnings growth rate. By the end of yesterday's trading, the Computer- Storage Devices industry had an average PEG ratio of 1.95.

The Computer- Storage Devices industry is part of the Computer and Technology sector. At present, this industry carries a Zacks Industry Rank of 27, placing it within the top 11% of over 250 industries.

The Zacks Industry Rank assesses the vigor of our specific industry groups by computing the average Zacks Rank of the individual stocks incorporated in the groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.

To follow NTAP in the coming trading sessions, be sure to utilize Zacks.com.


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