The Rapid Growth of NetApp

By CIOReview | Monday, September 3, 2018
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Based out of Sunnyvale, California, NetApp is a hybrid cloud data services company. NetApp’s offerings include software, and services to help customers manage and store data, both in the cloud and on-premise. The company provides a full range of hybrid cloud data services that simplify management of applications and data. As the shares of NetApp are moving at an excellent pace with the stock up 14.9 percent over the past month, investors are paying close attention. Recently, the company hit a new 52-week high of $79.75 in the previous session. Since the start of the year, NetApp has gained 42 percent. These metrics are in comparison with the 5.6 percent move for the computer and technology sector and the 19 percent year-to-date. The company’s stock so far has a great record of positive earnings. They have also beaten the Zacks Consensus Estimate recently in each of the last four quarters. A recent report from the company states an EPS of $1.05, while it beat the consensus revenue estimate by 2.86 percent.

Today, NetApp is expected to rise in the market with a $3.54 per share earnings and $6.19 billion in revenues, representing a 16.71 percent change in EPS on a 4.77 percent change in revenues. For the next fiscal year, the company is expected to earn $4.03 per share on $6.51 billion in revenues. This also represents a year-over-year change of 5.13 percent and 16.15 percent.

NetApp may be at a 52-week high right now, but the future of its growth is unpredictable. This question about the company can be identified by taking a look at valuation metrics. It can help in seamlessly determining if the company has run ahead of itself. Moreover, the Zacks Style Scores enables the investors with an additional way to sort through stocks. These styles are represented by grades running from A to F. These values are included in the categories of momentum and growth. The company also offers a combined VGM Score. This sophisticated scoring system helps organizations and investors to pick the most appropriate Zacks rank stocks based on the requirements and patterns of investments.

Under the scoring system, NetApp comes under D. The stock's momentum, and growth scores offer the company a VGM Score of B. Considering the value breakdown of the company, the stock currently trades at 22.2X year EPS estimates.