NetApp (NTAP) Downgraded to “Hold” at Zacks Investment Research

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NetApp (NASDAQ:NTAP) was downgraded by Zacks Investment Research from a “strong-buy” rating to a “hold” rating in a research note issued on Tuesday.

According to Zacks, “NetApp is benefitting from strong product adoption, increasing deal wins, and expanding customer base across varied geographies. Moreover, the company’s transition to data fabric strategy (a software-defined approach to data management) is expanding business opportunities. Further, the company increased momentum of its HCI and expanded new cloud partnerships, which contributed to overall revenue growth. Management remains hopeful about making the most of the exponential rate of data growth with its cloud-integrated all-flash solutions that fit well with hybrid cloud infrastructure. Notably, shares of the company have outperformed the industry in the past year. However, declining OEM revenues and stiff competition remain headwinds. Increasing investments to enhance cloud platform might limit margin expansion in near term.”

Several other equities analysts have also issued reports on NTAP. Wells Fargo & Co restated a “positive” rating and set a $80.00 price target on shares of NetApp in a research note on Wednesday, June 20th. Piper Jaffray Companies upped their price objective on NetApp from $77.00 to $86.00 and gave the company an “overweight” rating in a research note on Tuesday, June 26th. Guggenheim assumed coverage on NetApp in a research note on Thursday, July 12th. They issued a “buy” rating and a $94.00 price objective on the stock. Argus upped their price objective on NetApp to $90.00 and gave the company a “buy” rating in a research note on Thursday, July 5th. They noted that the move was a valuation call. Finally, DA Davidson reiterated a “buy” rating and issued a $90.00 price objective (up from $83.00) on shares of NetApp in a research note on Monday, July 9th. Two research analysts have rated the stock with a sell rating, nine have given a hold rating and nineteen have issued a buy rating to the company’s stock. The stock has an average rating of “Buy” and an average price target of $80.25.

NTAP traded up $1.55 on Tuesday, hitting $76.88. 119,148 shares of the stock traded hands, compared to its average volume of 2,871,801. NetApp has a 52 week low of $43.24 and a 52 week high of $88.08. The company has a quick ratio of 2.03, a current ratio of 2.06 and a debt-to-equity ratio of 0.80. The firm has a market capitalization of $22.27 billion, a price-to-earnings ratio of 25.71, a P/E/G ratio of 1.55 and a beta of 1.28.

NetApp (NASDAQ:NTAP) last issued its quarterly earnings results on Wednesday, August 15th. The data storage provider reported $1.04 earnings per share (EPS) for the quarter, beating the consensus estimate of $0.80 by $0.24. NetApp had a return on equity of 41.75% and a net margin of 3.68%. The firm had revenue of $1.47 billion for the quarter, compared to analyst estimates of $1.42 billion. During the same period in the previous year, the company posted $0.62 earnings per share. The company’s quarterly revenue was up 11.6% compared to the same quarter last year. Equities research analysts expect that NetApp will post 3.91 EPS for the current year.

In other NetApp news, CEO George Kurian sold 6,000 shares of the company’s stock in a transaction on Tuesday, September 4th. The stock was sold at an average price of $86.61, for a total transaction of $519,660.00. Following the transaction, the chief executive officer now owns 70,147 shares of the company’s stock, valued at approximately $6,075,431.67. The transaction was disclosed in a document filed with the SEC, which can be accessed through this link. Also, VP Joel D. Reich sold 7,157 shares of the company’s stock in a transaction on Friday, August 31st. The stock was sold at an average price of $86.83, for a total value of $621,442.31. Following the transaction, the vice president now directly owns 603 shares in the company, valued at approximately $52,358.49. The disclosure for this sale can be found here. Over the last 90 days, insiders have sold 150,137 shares of company stock worth $12,490,997. 0.19% of the stock is owned by corporate insiders.

A number of large investors have recently bought and sold shares of NTAP. Commonwealth Equity Services LLC lifted its holdings in NetApp by 15.7% during the 1st quarter. Commonwealth Equity Services LLC now owns 5,618 shares of the data storage provider’s stock worth $346,000 after buying an additional 762 shares in the last quarter. Natixis acquired a new position in shares of NetApp in the 1st quarter valued at $2,826,000. LPL Financial LLC lifted its stake in shares of NetApp by 27.9% in the 1st quarter. LPL Financial LLC now owns 18,100 shares of the data storage provider’s stock valued at $1,117,000 after purchasing an additional 3,947 shares during the period. Cubist Systematic Strategies LLC lifted its stake in shares of NetApp by 104.7% in the 1st quarter. Cubist Systematic Strategies LLC now owns 22,059 shares of the data storage provider’s stock valued at $1,361,000 after purchasing an additional 11,284 shares during the period. Finally, Amundi Pioneer Asset Management Inc. lifted its stake in shares of NetApp by 22.3% in the 1st quarter. Amundi Pioneer Asset Management Inc. now owns 381,020 shares of the data storage provider’s stock valued at $23,505,000 after purchasing an additional 69,530 shares during the period. 94.34% of the stock is currently owned by hedge funds and other institutional investors.

NetApp Company Profile

NetApp, Inc provides software, systems, and services to manage and share date on-premises, and private and public clouds worldwide. It offers cloud data services, such as ONTAP cloud storage data management and NetApp cloud sync data synchronization services; NetApp SaaS backup for Microsoft Office 365; NetApp cloud backup solutions; OnCommand management software and management integration tools; and NetApp private storage for cloud.

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