Netscout Systems (NTCT)
NASDAQ:NTCT
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Netscout Systems
(NASDAQ:NTCT)
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Rating:71Outperform
Price Target:
$36.00
▲(11.94% Upside)
Action:ReiteratedDate:02/06/26
The score is driven primarily by strong financial fundamentals (conservative balance sheet and solid cash generation) and a constructive earnings call with raised guidance and margin strength. These positives are tempered by weak-to-mixed technicals and the fundamental overhang of uneven/declining revenue trends and timing-related variability.
Positive Factors
Conservative balance sheet
Very low leverage and a large equity base give NetScout durable financial flexibility to fund R&D, pursue targeted M&A, sustain buybacks, or absorb cyclical weakness without forced financing. This reduces refinancing risk and supports multi-quarter strategic investments and capital allocation.
Negative Factors
Shrinking trailing revenue base
A materially contracting revenue base undermines durability of recently improved margins and cash flow; sustained top-line declines can force margin compression, limit reinvestment, and make earnings harder to sustain beyond transient cost cuts or one-time timing benefits.
Read all positive and negative factors
Positive Factors
Negative Factors
Conservative balance sheet
Very low leverage and a large equity base give NetScout durable financial flexibility to fund R&D, pursue targeted M&A, sustain buybacks, or absorb cyclical weakness without forced financing. This reduces refinancing risk and supports multi-quarter strategic investments and capital allocation.
Read all positive factors
Netscout Systems (NTCT) vs. SPDR S&P 500 ETF (SPY)
Market Cap
$2.32B
Dividend YieldN/A
Average Volume (3M)628.04K
Price to Earnings (P/E)8.8
Beta (1Y)0.92
Revenue Growth9.60%
EPS GrowthN/A
CountryUS
Employees2,273
SectorTechnology
Sector Strength88
IndustrySoftware - Infrastructure
Share Statistics
EPS (TTM)1.00
Shares Outstanding72,220,350
10 Day Avg. Volume460,602
30 Day Avg. Volume628,040
Financial Highlights & Ratios
PEG Ratio-0.03
Price to Book (P/B)0.97
Price to Sales (P/S)1.83
P/FCF Ratio7.14
Enterprise Value/Market Cap0.80
Enterprise Value/Revenue2.15
Enterprise Value/Gross Profit2.72
Enterprise Value/Ebitda10.57
Forecast
1Y Price Target
$32.00Price Target Upside-0.50% Downside
Rating ConsensusModerate Buy
Number of Analyst Covering2
EPS Forecast (FY)2.53
Revenue Forecast (FY)$876.86M
Netscout Systems Business Overview & Revenue Model
Company Description
NetScout Systems, Inc. provides service assurance and cybersecurity solutions for protect digital business services against disruptions in the United States, Europe, Asia, and internationally. The company offers nGeniusONE management software that...
How the Company Makes Money
NETSCOUT makes money by selling network and security visibility products and associated services to enterprises, government organizations, and telecommunications/service-provider customers. Its primary revenue streams are (1) product revenue from ...
Netscout Systems Key Performance Indicators (KPIs)
Netscout Systems Earnings Call Summary
Earnings Call Date:Feb 05, 2026
(Q3-2026)
| % Change Since: |
Next Earnings Date:May 07, 2026
Earnings Call Sentiment Positive
The call conveyed a generally constructive operational and financial picture: solid year-to-date revenue growth (~6%), stronger cybersecurity growth (9%), margin expansion, improved EPS, healthy cash generation and an upward adjustment to the fiscal year midpoint outlook. These positives were tempered by timing-related revenue variability (≈$15M of pull-ins), supply-chain and server-procurement timing risks, pressure in the service provider vertical, a rise in DSO to 82 days, and an inconsistency in reported third-quarter revenue figures noted between speakers. On balance the company showed execution, improving profitability and a resilient balance sheet, but with moderate near-term timing and industry headwinds to monitor.Positive Updates
Quarter Ahead of Expectations and EPS Growth
Management reported third-quarter results ahead of expectations with diluted EPS of $1.00, an increase of approximately 6% year over year (management cited ~6%–6.4% improvements).
Negative Updates
Timing-Related Revenue Variability and Pull-Ins
Management noted timing-related shifts in customer purchasing (deal acceleration and pull-ins). Approximately $15M of revenue was pulled into the quarter, creating unevenness across reporting periods and potentially reducing near-term revenue in subsequent quarters.
Read all updates
Q3-2026 Updates
Positive
Negative
Quarter Ahead of Expectations and EPS Growth
Management reported third-quarter results ahead of expectations with diluted EPS of $1.00, an increase of approximately 6% year over year (management cited ~6%–6.4% improvements).
Read all positive updates
Company Guidance
NetScout raised the midpoint of its fiscal 2026 outlook, now guiding revenue of $835 million to $870 million (midpoint implying ~3.6% year‑over‑year growth) versus the prior $830M–$870M range, and non‑GAAP diluted EPS of $2.37 to $2.45 (prior $2.35–$2.45); the company expects a full‑year effective tax rate of ~20% and assumes ~73–74 million weighted average diluted shares outstanding, says performance is expected around the midpoint while the wider range captures timing-related variability, and it retains capacity for share repurchases.Netscout Systems Financial Statement Overview
Summary
Income Statement
62
Positive
Balance Sheet
86
Very Positive
Cash Flow
78
Positive
| Breakdown | TTM | Mar 2025 | Mar 2024 | Mar 2023 | Mar 2022 | Mar 2021 |
|---|---|---|---|---|---|---|
Income Statement | ||||||
| Total Revenue | 861.43M | 822.68M | 829.46M | 914.53M | 855.58M | 831.28M |
| Gross Profit | 682.68M | 643.94M | 642.04M | 691.43M | 641.39M | 609.18M |
| EBITDA | 175.53M | -294.85M | -60.87M | 174.01M | 146.72M | 139.01M |
| Net Income | 95.91M | -366.92M | -147.73M | 59.65M | 35.87M | 19.35M |
Balance Sheet | ||||||
| Total Assets | 2.32B | 2.19B | 2.60B | 2.82B | 3.19B | 3.09B |
| Cash, Cash Equivalents and Short-Term Investments | 573.00M | 491.47M | 423.13M | 419.00M | 703.20M | 476.45M |
| Total Debt | 73.56M | 76.01M | 182.59M | 209.29M | 469.26M | 484.89M |
| Total Liabilities | 680.38M | 626.18M | 703.24M | 790.91M | 1.13B | 1.08B |
| Stockholders Equity | 1.64B | 1.56B | 1.89B | 2.03B | 2.06B | 2.01B |
Cash Flow | ||||||
| Free Cash Flow | 275.48M | 210.97M | 52.47M | 146.00M | 285.61M | 197.40M |
| Operating Cash Flow | 283.80M | 217.67M | 58.81M | 156.65M | 296.01M | 213.92M |
| Investing Cash Flow | -26.40M | -7.00M | 13.36M | 15.30M | -68.35M | 24.70M |
| Financing Cash Flow | -122.73M | -142.01M | -69.35M | -419.43M | -54.16M | -118.31M |
Netscout Systems Technical Analysis
Positive
32.16
Price Trends
30.09
Positive
28.68
Positive
26.71
Positive
Market Momentum
0.80
Negative
56.00
Neutral
51.79
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For NTCT, the sentiment is Positive. The current price of 32.16 is above the 20-day moving average (MA) of 31.70, above the 50-day MA of 30.09, and above the 200-day MA of 26.71, indicating a bullish trend. The MACD of 0.80 indicates Negative momentum. The RSI at 56.00 is Neutral, neither overbought nor oversold. The STOCH value of 51.79 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for NTCT.
Netscout Systems Risk Analysis
Netscout Systems disclosed 33 risk factors in its most recent earnings report. Netscout Systems reported the most risks in the "Finance & Corporate" category.
Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy
Latest Risks Added 0 New Risks
Netscout Systems Peers Comparison
UnderperformOutperform
Sector (61)
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
71 Outperform | $2.32B | 8.80 | 6.07% | ― | 9.60% | ― | |
70 Outperform | $1.72B | 30.33 | 20.61% | 1.33% | 10.27% | 3.52% | |
69 Neutral | $1.01B | 50.99 | 5.95% | ― | 10.40% | ― | |
68 Neutral | $2.96B | 35.80 | 115.65% | ― | 7.21% | 58.61% | |
63 Neutral | $1.04B | 39.43 | 5.36% | ― | 12.48% | ― | |
61 Neutral | $37.18B | 12.37 | -10.20% | 1.83% | 8.50% | -7.62% |
* Technology Sector Average
NTCT
Netscout Systems
32.16
12.06
60.00%
RDWR
Radware
23.37
2.50
11.98%
ATEN
A10 Networks
24.00
8.44
54.22%
FIVN
Five9
13.61
-9.57
-41.29%
BOX
Box
21.37
-8.74
-29.03%
Glossary
BuyA stock rated as a "Buy" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock is likely to deliver higher returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
HoldA stock rated as a "Hold" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly compelling nor unfavorable for investment. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
SellA stock rated as a "Sell" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock may deliver lower returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
Disclaimer
This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.