NetApp (NTAP) AI Stock Analysis

• Market Cap: $23.31B
• Dividend Yield: 1.77%
• Average Volume (3M): 2.01M
• Price to Earnings (P/E): 20.8
• Beta (1Y): 1.47
• Revenue Growth: 3.45%
• EPS Growth: 9.69%
• Country: US
• Employees: 11,800
• Sector: Technology
• Sector Strength: 88
• Industry: Computer Hardware
• EPS (TTM): 1.55
• Shares Outstanding: 199,618,400
• 10 Day Avg. Volume: 1,990,946
• 30 Day Avg. Volume: 2,011,659
• PEG Ratio: 0.67
• Price to Book (P/B): 17.35
• Price to Sales (P/S): 2.75
• P/FCF Ratio: 13.49
• Enterprise Value/Market Cap: 0.89
• Enterprise Value/Revenue: 3.14
• Enterprise Value/Gross Profit: 4.49
• Enterprise Value/Ebitda: 12.22
• 1Y Price Target: $120.50
• Price Target Upside: 2.30% Upside
• Rating Consensus: Moderate Buy
• Number of Analyst Covering: 14

• Rating: 78 Outperform
• Price Target: $136.00 ▲(15.46% Upside)

NetApp's strong financial performance and positive earnings call are the most significant factors driving the score. The company's robust revenue growth, profitability, and strategic focus on cloud services and AI infrastructure position it well for future growth. Technical analysis and valuation suggest moderate potential, while challenges in certain regions and product segments warrant cautious optimism.

Positive Factors

Revenue Growth

Record revenue growth indicates strong market demand and successful product adoption, supporting long-term financial stability and expansion.

Cloud and AI Expansion

Rapid growth in AI and cloud segments positions NetApp as a leader in emerging tech markets, ensuring future revenue streams and competitive advantage.

Strong Cash Flow

Robust cash flow generation supports ongoing investments and shareholder returns, enhancing financial flexibility and growth potential.

Negative Factors

Macroeconomic Uncertainty

Global economic uncertainties could impact demand and revenue, posing risks to growth and financial performance in affected regions.

Increased Financial Leverage

Higher financial leverage may limit NetApp's ability to invest in growth opportunities and increase vulnerability to economic downturns.

Impact of Spot Business Divestiture

Divesting the Spot business could reduce short-term revenue growth, affecting overall financial performance and market perception.

NetApp Business Overview & Revenue Model

Company Description

NetApp, Inc. provides cloud-led and data-centric services to manage and share data on-premises, and private and public clouds worldwide. It operates in two segments, Hybrid Cloud and Public Could. The company offers intelligent data management software, such as NetApp ONTAP, NetApp Snapshot, NetApp SnapCenter Backup Management, NetApp SnapMirror Data Replication, NetApp SnapLock Data Compliance, NetApp ElementOS software, and NetApp SANtricity software; and storage infrastructure solutions, including NetApp All-Flash FAS series, NetApp Fabric Attached Storage, NetApp FlexPod, NetApp E/EF series, NetApp StorageGRID, and NetApp SolidFire. It also provides cloud storage and data services comprising NetApp Cloud Volumes ONTAP, Azure NetApp Files, Amazon FSx for NetApp ONTAP, NetApp Cloud Volumes Service for Google Cloud, NetApp Cloud Sync, NetApp Cloud Tiering, NetApp Cloud Backup, NetApp Cloud Data Sense, and NetApp Cloud Volumes Edge Cache; and cloud operations services, such as NetApp Cloud Insights, Spot Ocean Kubernetes Suite, Spot Security, Spot Eco, and Spot CloudCheckr. In addition, the company offers application-aware data management service under the NetApp Astra name; and professional and support services, such as strategic consulting, professional, managed, and support services. Further, it provides assessment, design, implementation, and migration services. The company serves the energy, financial service, government, technology, internet, life science, healthcare service, manufacturing, media, entertainment, animation, video postproduction, and telecommunication markets through a direct sales force and an ecosystem of partners. NetApp, Inc. was incorporated in 1992 and is headquartered in San Jose, California.

How the Company Makes Money

NetApp generates revenue primarily through the sale of hardware, software, and cloud services. Its key revenue streams include the sale of storage and data management products, which encompass hardware appliances and associated software licenses. The company also earns significant revenue from subscription-based cloud services that enable customers to leverage hybrid cloud environments. Additionally, NetApp provides professional services and support, which contribute to its overall earnings. Strategic partnerships with major cloud providers, such as Microsoft Azure and Amazon Web Services, further enhance NetApp's market presence and create additional revenue opportunities through integrated solutions. The company's focus on innovation and expansion into emerging technologies, such as AI and machine learning, also plays a crucial role in driving its financial performance.

NetApp Financial Statement Overview

Summary

NetApp exhibits strong financial performance with robust revenue growth and profitability. The company maintains healthy margins and has shown improvement in cash flow generation. However, the high debt-to-equity ratio suggests a need for careful management of financial leverage.

Income Statement

NetApp's income statement shows strong profitability with a gross profit margin of 70.19% and a net profit margin of 18.05% for the TTM. The company has demonstrated significant revenue growth of 27.4% in the TTM period, indicating robust demand for its products. EBIT and EBITDA margins are healthy at 22.02% and 25.72%, respectively, reflecting efficient operational management. However, the net profit margin has slightly decreased from previous periods, suggesting some pressure on net earnings.

Balance Sheet

The balance sheet reveals a high debt-to-equity ratio of 3.36, indicating significant leverage, which could pose a risk if not managed carefully. Return on equity is impressive at 123.03%, showcasing strong profitability relative to shareholder equity. The equity ratio is relatively low, suggesting a higher reliance on debt financing. Overall, while profitability metrics are strong, the high leverage warrants cautious monitoring.

Cash Flow

NetApp's cash flow statement highlights a solid free cash flow growth rate of 23.92% in the TTM, indicating improved cash generation capabilities. The operating cash flow to net income ratio is 0.32, and the free cash flow to net income ratio is 0.89, reflecting efficient conversion of income into cash. Despite previous fluctuations in free cash flow growth, the recent positive trend is encouraging.

Breakdown	TTM	Dec 2025	Dec 2024	Dec 2023	Dec 2022	Dec 2021
Income Statement
Total Revenue	6.59B	6.57B	6.27B	6.36B	6.32B	5.74B
Gross Profit	4.61B	4.61B	4.43B	4.21B	4.22B	3.81B
EBITDA	1.70B	1.69B	1.58B	1.43B	1.36B	1.29B
Net Income	1.17B	1.19B	986.00M	1.27B	937.00M	730.00M
Balance Sheet
Total Assets	9.68B	10.82B	9.89B	9.82B	10.03B	9.36B
Cash, Cash Equivalents and Short-Term Investments	3.32B	3.85B	3.25B	3.07B	4.13B	4.60B
Total Debt	2.75B	3.49B	2.65B	2.68B	2.94B	2.75B
Total Liabilities	8.70B	9.78B	8.74B	8.66B	9.19B	8.68B
Stockholders Equity	975.00M	1.04B	1.15B	1.16B	838.00M	685.00M
Cash Flow
Free Cash Flow	1.66B	1.34B	1.53B	868.00M	985.00M	1.17B
Operating Cash Flow	1.84B	1.51B	1.69B	1.11B	1.21B	1.33B
Investing Cash Flow	17.00M	147.00M	-735.00M	-1.39B	-561.00M	21.00M
Financing Cash Flow	-1.44B	-828.00M	-1.34B	-1.51B	-1.02B	444.00M

NetApp Technical Analysis

• Technical Analysis Sentiment: Neutral
• Last Price: 117.79
• 50DMA: Positive
• 100DMA: Positive
• 200DMA: Positive
• MACD: Positive
• RSI: Neutral
• STOCH: Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For NTAP, the sentiment is Neutral. The current price of 117.79 is below the 20-day moving average (MA) of 118.82, above the 50-day MA of 117.76, and above the 200-day MA of 105.78, indicating a neutral trend. The MACD of -0.10 indicates Positive momentum. The RSI at 48.09 is Neutral, neither overbought nor oversold. The STOCH value of 41.62 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Neutral sentiment for NTAP.

NetApp Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
NTAP	78 Outperform	$23.31B	20.81	123.00%	1.77%	3.45%	9.69%
PSTG	76 Outperform	$29.22B	229.94	10.04%	―	11.31%	-1.30%
WDC	76 Outperform	$41.62B	25.17	25.98%	0.16%	2.12%	―
SMCI	67 Neutral	$31.20B	28.87	17.90%	―	47.04%	-17.89%
STX	65 Neutral	$45.70B	31.70	―	1.27%	38.86%	337.22%
HPQ	63 Neutral	$26.32B	10.25	―	4.16%	3.11%	-3.54%
Sector *	61 Neutral	$37.18B	12.37	-10.20%	1.83%	8.50%	-7.62%

NetApp Corporate Events

NetApp’s Strong Start to Fiscal 2026: Earnings Call Insights

NetApp Inc. kicked off fiscal year 2026 with a strong earnings call, showcasing a balanced sentiment. The company exceeded revenue guidance and reported significant growth in its all-flash and cloud services. However, challenges were noted in the US public sector and EMEA, alongside a decline in product revenue. Despite these hurdles, NetApp highlighted robust cash flow and strategic wins in AI infrastructure, painting a mixed yet optimistic picture for investors.

NetApp Reports Solid Start to Fiscal 2026

NetApp Inc., a leader in intelligent data infrastructure, specializes in unified data storage and integrated data services, offering solutions that enable seamless hybrid and multicloud transformations.