investorscraft@gmail.com

Intrinsic ValueNetApp, Inc. (NTAP)

Previous Close$124.00
Intrinsic Value
Upside potential
Previous Close
$124.00

VALUATION INPUT DATA

This valuation is based on fiscal year data as of 2025 and quarterly data as of .

Data is not available at this time.

Stock Valuation Context

Business Model And Market Position

NetApp, Inc. operates as a hybrid cloud data services and data management company, specializing in storage systems, software, and cloud solutions. The company serves enterprises across industries, offering unified storage platforms, data fabric software, and AI-driven analytics to optimize data accessibility and security. NetApp differentiates itself through its hybrid multicloud expertise, enabling seamless integration between on-premises and public cloud environments, which is critical for modern IT infrastructure. Its flagship products include ONTAP, Cloud Volumes, and Astra, which cater to enterprises requiring scalable, high-performance data solutions. The company competes with established players like Dell EMC, Pure Storage, and cloud-native providers, maintaining a strong position in mid-to-large enterprise markets. NetApp’s partnerships with hyperscalers such as AWS, Microsoft Azure, and Google Cloud enhance its market reach, reinforcing its role as a bridge between traditional storage and cloud-native architectures. The company’s focus on subscription-based and recurring revenue models aligns with industry shifts toward software-defined and as-a-service offerings, ensuring long-term customer retention and predictable cash flows.

Revenue Profitability And Efficiency

NetApp reported revenue of $6.27 billion for FY 2024, with net income of $986 million, reflecting a disciplined cost structure and operational efficiency. Diluted EPS stood at $4.63, supported by strong gross margins in its software and subscription segments. Operating cash flow of $1.69 billion underscores robust cash generation, while capital expenditures of $155 million indicate prudent investment in growth initiatives. The company’s ability to convert revenue into free cash flow remains a key strength.

Earnings Power And Capital Efficiency

NetApp demonstrates solid earnings power, with a net income margin of approximately 15.7%, driven by high-margin software and services. The company’s capital efficiency is evident in its operating cash flow yield relative to revenue, which supports reinvestment and shareholder returns. Share buybacks and dividends are funded sustainably, reflecting disciplined capital allocation and a focus on enhancing shareholder value.

Balance Sheet And Financial Health

NetApp maintains a strong balance sheet with $1.9 billion in cash and equivalents, providing liquidity for strategic initiatives. Total debt of $2.65 billion is manageable, given the company’s cash flow generation and low leverage ratio. The balance sheet supports ongoing investments in innovation and cloud partnerships while ensuring financial flexibility for potential acquisitions or market downturns.

Growth Trends And Dividend Policy

NetApp’s growth is increasingly driven by subscription and recurring revenue streams, which now represent a significant portion of total sales. The company has consistently raised its dividend, with a payout of $2.00 per share in FY 2024, reflecting confidence in sustained cash flow. Strategic focus on hybrid cloud and AI-driven data management positions NetApp for long-term growth in a rapidly evolving IT landscape.

Valuation And Market Expectations

NetApp trades at a valuation reflective of its transition to higher-margin software and cloud services. Market expectations are anchored to its ability to maintain growth in recurring revenue while navigating competitive pressures. The company’s P/E ratio and free cash flow yield suggest a balanced risk-reward profile, with upside tied to execution in hybrid cloud adoption.

Strategic Advantages And Outlook

NetApp’s strategic advantages lie in its hybrid cloud expertise, strong partner ecosystem, and focus on high-value data management solutions. The outlook remains positive, with demand for unified storage and cloud-native tools expected to grow. Execution risks include competition from hyperscalers and macroeconomic pressures, but NetApp’s differentiated offerings position it well for sustained relevance in enterprise IT infrastructure.

Sources

FY 2024 10-K, investor presentations

show cash flow forecast

FINANCIAL STATEMENTS FORECAST and PRESENT VALUE CALCULATION

Fiscal year2026202720282029203020312032203320342035203620372038203920402041204220432044204520462047204820492050

INCOME STATEMENT

Revenue growth rate, %NaN
Revenue, $NaN
Variable operating expenses, $mNaN
Fixed operating expenses, $mNaN
Total operating expenses, $mNaN
Operating income, $mNaN
EBITDA, $mNaN
Interest expense (income), $mNaN
Earnings before tax, $mNaN
Tax expense, $mNaN
Net income, $mNaN

BALANCE SHEET

Cash and short-term investments, $mNaN
Total assets, $mNaN
Adjusted assets (=assets-cash), $mNaN
Average production assets, $mNaN
Working capital, $mNaN
Total debt, $mNaN
Total liabilities, $mNaN
Total equity, $mNaN
Debt-to-equity ratioNaN
Adjusted equity ratioNaN

CASH FLOW

Net income, $mNaN
Depreciation, amort., depletion, $mNaN
Funds from operations, $mNaN
Change in working capital, $mNaN
Cash from operations, $mNaN
Maintenance CAPEX, $mNaN
New CAPEX, $mNaN
Total CAPEX, $mNaN
Free cash flow, $mNaN
Issuance/(repurchase) of shares, $mNaN
Retained Cash Flow, $mNaN
Pot'l extraordinary dividend, $mNaN
Cash available for distribution, $mNaN
Discount rate, %NaN
PV of cash for distribution, $mNaN
Current shareholders' claim on cash, %NaN
HomeMenuAccount