NetApp Inc. (NTAP) Upgraded by Credit Suisse Group AG to Neutral
Credit Suisse Group AG upgraded shares of NetApp Inc. (NASDAQ:NTAP) from an underperform rating to a neutral rating in a research note released on Thursday. They currently have $37.00 price target on the data storage provider’s stock, up from their previous price target of $35.00.
“solid” and highlighted by a quarter-over-quarter and year-over-year growth in revenues to $1.48 billion and an earnings per share of $0.86, which was four cents better than expected. Also, the company reported an operating margin of 20.7 percent, which was better than the 19.2 percent he had expected.Limited DownsideGarcha continued that while NetApp’s revenue and EPS guidance fell short of expectations, there is reason to believe revenue can grow. The analyst noted that in the recent quarter, product revenue grew 12 percent year-over-year, and while this growth rate will decelerate moving forward, the relative balance of strategic offering at two-thirds of total product revenues versus mature offering at one-third implies revenue growth could be “more achievable.”Garcha further argued that although concerns over NetApp’s growth profile remains, the analyst has confidence in the company’s performance throughout the year, especially in improving operating margin performance.As such, the analyst’s $37 price target reflects a P/E of 10x on his fiscal 2019 earnings per share estimate and factors in the approximate $5 of fully taxed net cash for per share. As such, downside in the stock is “limited,” the firm’s analyst commented.
A number of other research firms also recently commented on NTAP. Wells Fargo & Co reissued a market perform rating and issued a $40.00 target price on shares of NetApp in a report on Thursday, March 16th. Susquehanna Bancshares Inc reissued a positive rating and issued a $48.00 target price on shares of NetApp in a report on Friday, March 31st. Zacks Investment Research downgraded NetApp from a buy rating to a hold rating in a report on Monday, April 3rd. Drexel Hamilton reissued a buy rating on shares of NetApp in a report on Monday, April 3rd. Finally, Bank of America Corp reissued a neutral rating and issued a $48.00 target price (up previously from $45.00) on shares of NetApp in a report on Wednesday, May 17th. Five investment analysts have rated the stock with a sell rating, nineteen have issued a hold rating and eleven have assigned a buy rating to the company. The stock currently has a consensus rating of Hold and an average target price of $40.80.
Shares of NetApp (NASDAQ:NTAP) traded down 1.32% during midday trading on Thursday, reaching $40.42. 1,943,895 shares of the company traded hands. The stock’s 50-day moving average is $40.12 and its 200-day moving average is $38.63. NetApp has a 1-year low of $22.89 and a 1-year high of $43.14. The stock has a market capitalization of $10.95 billion, a P/E ratio of 36.91 and a beta of 1.50. NetApp also was the recipient of unusually large options trading on Wednesday. Stock investors acquired 13,364 call options on the stock. This is an increase of 735% compared to the typical volume of 1,600 call options.
NetApp (NASDAQ:NTAP) last issued its quarterly earnings results on Wednesday, May 24th. The data storage provider reported $0.86 earnings per share for the quarter, topping the Thomson Reuters’ consensus estimate of $0.82 by $0.04. NetApp had a return on equity of 15.66% and a net margin of 5.89%. The firm had revenue of $1.48 billion during the quarter, compared to the consensus estimate of $1.44 billion. During the same period last year, the company earned $0.55 earnings per share. The company’s revenue for the quarter was up 7.3% on a year-over-year basis. Equities analysts predict that NetApp will post $3.04 EPS for the current fiscal year.
The business also recently announced a quarterly dividend, which will be paid on Wednesday, July 26th. Investors of record on Friday, July 7th will be given a $0.20 dividend. The ex-dividend date is Wednesday, July 5th. This represents a $0.80 dividend on an annualized basis and a dividend yield of 1.95%. This is an increase from NetApp’s previous quarterly dividend of $0.19. NetApp’s payout ratio is currently 69.09%.
In other NetApp news, Director Alan L. Earhart sold 27,422 shares of the business’s stock in a transaction that occurred on Wednesday, March 8th. The stock was sold at an average price of $42.46, for a total transaction of $1,164,338.12. Following the transaction, the director now owns 21,611 shares of the company’s stock, valued at $917,603.06. The sale was disclosed in a document filed with the SEC, which is available through this link. Also, CEO George Kurian sold 4,000 shares of the business’s stock in a transaction that occurred on Monday, May 1st. The stock was sold at an average price of $40.01, for a total value of $160,040.00. Following the transaction, the chief executive officer now directly owns 20,396 shares in the company, valued at approximately $816,043.96. The disclosure for this sale can be found here. In the last ninety days, insiders sold 35,422 shares of company stock worth $1,490,498. 0.49% of the stock is owned by company insiders.
A number of institutional investors have recently made changes to their positions in NTAP. American Beacon Advisors Inc. acquired a new position in shares of NetApp during the first quarter worth $110,000. Seven Eight Capital LP acquired a new position in shares of NetApp during the fourth quarter worth $118,000. Carroll Financial Associates Inc. acquired a new position in shares of NetApp during the first quarter worth $123,000. NJ State Employees Deferred Compensation Plan acquired a new position in shares of NetApp during the first quarter worth $209,000. Finally, Cambridge Investment Research Advisors Inc. acquired a new position in shares of NetApp during the first quarter worth $209,000. 92.52% of the stock is currently owned by hedge funds and other institutional investors.
NetApp Company Profile
NetApp, Inc (NetApp) provides software, systems and services to manage and store customer data. The Company enables enterprises, service providers, governmental organizations, and partners to envision, deploy and evolve their information technology (IT) environments. The Company offers a portfolio of products and services that satisfy a range of customer workloads across different data types and deployment models.
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