Evercore ISI analyst Amit Daryanani has maintained their neutral stance on NTAP stock, giving a Hold rating today.
Amit Daryanani has given his Hold rating due to a combination of factors including NetApp’s recent financial performance and future guidance. Daryanani acknowledges NetApp’s impressive quarterly results, which surpassed expectations with strong revenue growth, particularly in the product segment. The company’s robust gross margins, especially in product sales due to the shift towards high-margin all-flash products, along with disciplined operational expenditure, contributed to significant earnings per share upside. Additionally, notable successes in the AI space and an anticipated continued growth in the public cloud sector post-FY25 have been highlighted as positive indicators for the company’s prospects.
However, Daryanani remains cautious, maintaining an In-Line rating with a revised target price. This caution stems from concerns regarding the overall unchanged macroeconomic environment and potential headwinds such as increasing NAND pricing, which could impact gross margins despite the favorable product mix. The Hold rating appears to balance the strong current performance and strategic initiatives against these potential challenges and broader market conditions. Despite the upward revision in the target price, the Hold rating suggests that Daryanani believes that while NetApp is executing well, the stock may already reflect the near-term positives, and investors should wait for a more attractive entry point or clearer signs of sustained growth beyond the immediate future.
Daryanani covers the Technology sector, focusing on stocks such as Apple, Cisco Systems, and HP. According to TipRanks, Daryanani has an average return of 12.0% and a 59.01% success rate on recommended stocks.
In another report released today, Barclays also maintained a Hold rating on the stock with a $100.00 price target.
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NetApp (NTAP) Company Description:
NetApp, Inc. engages in the design, manufacture, marketing, and technical support of storage and data management solutions. It offers cloud data services, data storage software, data backup and recovery, all-flash storage, converged systems, data infrastructure management, ONTAP data security, and hybrid flash storage. The company was founded by David Hitz, James K. Lau and Michael Malcolm in April 1992 and is headquartered in Sunnyvale, CA.
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