NetApp (NTAP) analysts liked the last earnings report and a recent conference. Estimates keep moving higher, leaving this Zacks #1 Rank (Strong Buy) with some healthy growth rates.
Company Description
NetApp offers storage and data management solutions for businesses.
Beat the Street Again
The company has now topped analyst estimates for the seventh straight quarter, the latest coming on May 25. In a press release NetApp said it earned $0.47 per share, 3 cents higher than the Zacks Consensus Estimate.
Revenues picked up 22% on a year over year basis, to $1.4 billion. For the full year, the top line jumped 30% and cash from operations great 38%.
NetApp also offered a bullish outlook for the coming quarter.
Analysts Pad Estimates
Outlooks for fiscal 2012 continue to move higher, with the average estimates rising 30 cents, to $2.14 in the past 2 months. Next year’s Zacks Consensus Estimate is also up 30 cents, to $2.50.
Last year the company brought in $1.76 per share, so the estimated growth rates are at 22% this year and 17% in fiscal 2013.
M&A Activity
At NetApp’s analyst conference on Jun 30, the company highlighted its desire to double earnings through a combination of both organic and M&A growth initiatives.
The most recent purchase was the Engenio storage product line from LSI Corporation (LSI).
Buying Back
On Jun 28 NetApp said it plans on buying back $200 million in common share. That is a bit of a double-edged sword though. Great to reduce the number of outstanding shares, but does that mean there aren’t enough growth opportunities out there?
The company will still have $900 million left from the preexisting authorization.
The Chart
Often times those investor or analyst days are more of a non-event, but NTAP pleased a few people with its updates. Volume was up nicely as was the share price on the day.
Bill Wilton is the Aggressive Growth Stock Strategist for Zacks.com. He is also the Editor in charge of the Zacks Small Cap Trader service
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