Stifel Raises NetApp (NTAP) Estimates After ELAs and Flash Offset Slowing Product Growth

Stifel analyst, Matthew Sheerin, reiterated his Buy rating on shares of NetApp (NASDAQ: NTAP) after Oct-Q sales were reported in line while EPS of $1.06 was 7 cents ahead well ahead of the Consensus $0.99. Better than expected margins drove the upside with $20mn in Enterprise License Agreements (ELAs) adding roughly a point of EBIT margin.

The analyst stated "While product revenue growth of 12% y/y was down from 20% y/y growth last quarter, sales of all-flash arrays grew a solid 29% y/y. In addition, NTAP continued to gain early traction with its cloud-based software offerings. We believe NTAP's multi-cloud, multi-platform product and software offering, all supported by its Data Fabric ecosystem, positions NTAP well across all-flash, converged, and hyperconverged storage solutions". No change to the price target of $91.

For an analyst ratings summary and ratings history on NetApp click here. For more ratings news on NetApp click here.

Shares of NetApp closed at $78.03 yesterday.

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