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Tickers in this Article: NTAP
NetApp (Nasdaq:NTAP) will release its second quarter results on Wednesday, November 14, 2012. Analysts are expecting earnings per share of 33 cents after the company booked a profit of only 50 cents a share a year earlier.

A business' earnings are the main determinant of its share price because earnings and the circumstances relating to them can indicate whether the business will be profitable and successful in the long run. SEE: Surprising Earnings Results

What to Expect: Analysts are anticipating that NetApp will report earnings of 33 cents per share, down 34% from a year ago, when the company reported earnings of 50 cents per share.

The consensus estimate is down from three months ago when it was 34 cents. Analysts are projecting earnings of $1.45 per share for the fiscal year.

NetApp is expected to beat last year's reported revenue of $1.51 billion and come in at $1.54 billion for the quarter. Revenue for the fiscal year is expected to come in at $6.37 billion.

Company Performance: Revenue fell year-over-year in the first quarter to end a three-quarter growth streak. It fell 0.9% in the first quarter after rising 12.8%in the fourth quarter of the last fiscal year, 23.5% in the third quarter of the last fiscal year and 24.8% in the second quarter of the last fiscal year.

NTAP's P/E ratio is 19.7. A simple P/E ratio can reveal the stock's real market value and show how the valuation compares to its industry group or a benchmark like the S&P 500 Index. A high or low P/E ratio is not good or bad in and of itself, but a company trading with a high P/E ratio must continue to post strong financial performance or its stock price is likely to fall. SEE: Profit With The Power Of Price-To-Earnings

Since August 13, 2012, the stock price has fallen 14.1% to $27.31 from $31.81. The price is within 48 cents of its 52-week low of $26.83, which was set on October 31, 2012. The stock saw one of its worst stretches when its price fell $4.05 per share between September 26, 2012 and October 12, 2012.

The Competition: NetApp supplies enterprise storage and data management software and hardware products and services. Nineteen of 27 analysts rate NetApp a hold. They have grown a bit more optimistic about the stock, as the number of buy ratings has inched up over the past three months.

The company's closest competitor in the computer storage devices industry is EMC (EMC). Analysts are more optimistic about NetApp than about EMC. Only 28 out of 30 analysts rate the latter a buy compared to eight of 27 for the former.

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