Critical Contrast: NetApp (NTAP) vs. Its Rivals

NetApp (NASDAQ:NTAP – Get Free Report) is one of 82 publicly-traded companies in the “Technology Hardware, Storage & Peripherals” industry, but how does it compare to its peers? We will compare NetApp to related companies based on the strength of its analyst recommendations, institutional ownership, risk, earnings, dividends, valuation and profitability.

Insider & Institutional Ownership

92.2% of NetApp shares are held by institutional investors. Comparatively, 51.3% of shares of all “Technology Hardware, Storage & Peripherals” companies are held by institutional investors. 0.4% of NetApp shares are held by company insiders. Comparatively, 10.5% of shares of all “Technology Hardware, Storage & Peripherals” companies are held by company insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a stock is poised for long-term growth.

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Risk and Volatility

NetApp has a beta of 1.45, meaning that its stock price is 45% more volatile than the S&P 500. Comparatively, NetApp’s peers have a beta of 1.56, meaning that their average stock price is 56% more volatile than the S&P 500.

Dividends

NetApp pays an annual dividend of $2.08 per share and has a dividend yield of 1.1%. NetApp pays out 32.7% of its earnings in the form of a dividend. As a group, “Technology Hardware, Storage & Peripherals” companies pay a dividend yield of 2.5% and pay out 32.2% of their earnings in the form of a dividend. NetApp has raised its dividend for 1 consecutive years. NetApp lags its peers as a dividend stock, given its lower dividend yield and higher payout ratio.

Profitability

This table compares NetApp and its peers’ net margins, return on equity and return on assets.

Analyst Ratings

This is a summary of recent ratings and recommmendations for NetApp and its peers, as reported by MarketBeat.

NetApp currently has a consensus price target of $169.33, indicating a potential downside of 10.65%. As a group, “Technology Hardware, Storage & Peripherals” companies have a potential upside of 27.19%. Given NetApp’s peers stronger consensus rating and higher possible upside, analysts plainly believe NetApp has less favorable growth aspects than its peers.

Earnings and Valuation

This table compares NetApp and its peers top-line revenue, earnings per share (EPS) and valuation.

NetApp’s peers have higher revenue and earnings than NetApp. NetApp is trading at a higher price-to-earnings ratio than its peers, indicating that it is currently more expensive than other companies in its industry.

Summary

NetApp peers beat NetApp on 10 of the 15 factors compared.

About NetApp

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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, and storage infrastructure solutions, including NetApp All-Flash FAS series, NetApp Fabric Attached Storage, NetApp E/EF series, and NetApp StorageGRID. In addition, it 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, and cloud operations services, such as NetApp Cloud Insights, Spot by NetApp, and Instaclustr. Further, 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. Additionally, 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 markets through a direct sales force and an ecosystem of partners. NetApp, Inc. was incorporated in 1992 and is headquartered in San Jose, California.

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