NetApp’s Strong Performance Overshadowed by Conservative Guidance: A Hold Rating Perspective

William Blair analyst Jason Ader has maintained their neutral stance on NTAP stock, giving a Hold rating yesterday.

Jason Ader has given his Hold rating due to a combination of factors that reflect both strengths and cautionary signals in NetApp’s recent performance and outlook. The company reported a strong fourth quarter, surpassing expectations in both revenue and earnings, driven by market share gains in all-flash storage and robust performance in cloud storage. However, despite these positive results, the guidance issued by NetApp was more conservative, which likely contributed to the stock’s decline in after-hours trading.
Looking ahead, the company’s first-quarter guidance fell short of consensus estimates, indicating modest revenue growth and a slight decline in earnings per share. Additionally, the full-year fiscal 2026 revenue guidance also missed expectations, although earnings per share guidance was slightly better than anticipated. These projections consider the impact of the divestiture of the Spot by NetApp business and a cautious spending environment due to ongoing macroeconomic uncertainties. This mix of solid performance and cautious guidance underpins Ader’s decision to maintain a Hold rating on the stock.

In another report released yesterday, Wedbush also maintained a Hold rating on the stock with a $110.00 price target.