Stifel Upgrades NetApp (NTAP) to Buy, 'Meetings Highlight Potential Positive Catalysts in FY24'

Stifel analyst Matthew Sheerin upgraded NetApp (NASDAQ: NTAP) from Hold to Buy with a price target of $75.00.

The analyst comments "We hosted investor meetings with NetApp CFO Mike Berry and IR VP Kris Newton. The execs acknowledged that predicting when the current demand cycle bottoms continues to be difficult. But they also pointed to several company-specific initiatives/catalysts that should help boost margins and EPS in coming quarters, regardless of how macro plays out. Those include: 1) a recent 8% headcount reduction; 2) a planned sales force re-org aimed at aligning reps more closely with specific customers and vendors; 3) an expected margin tailwind from lower component costs due to improved supply; and 4) the recent introduction of QLC-based, lower-cost all-flash arrays (C-Series), which could help boost market share. We came away from the meetings more confident in our FY24 estimate -- $5.49 -- which reflects a soft 1H but a return to sales and EPS growth in 2H24. We upgrade our rating to Buy and maintain our $75PT (19% upside)."

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 $63.00 yesterday.

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