Why NASDAQ:NTAP provides a good dividend, while having solid fundamentals.

Take a closer look at NETAPP INC (NASDAQ:NTAP), a stock of interest to dividend investors uncovered by our stock screener. NASDAQ:NTAP excels in fundamentals and provides a decent dividend, all while maintaining a reasonable valuation. Let's break it down further.

Assessing Dividend Metrics for NASDAQ:NTAP

ChartMill provides a Dividend Rating for every stock, ranging from 0 to 10. This rating assesses various dividend aspects, including yield, growth, and sustainability. NASDAQ:NTAP earns a 7 out of 10:

• NTAP's Dividend Yield is rather good when compared to the industry average which is at 2.99. NTAP pays more dividend than 81.25% of the companies in the same industry.
• NTAP has been paying a dividend for at least 10 years, so it has a reliable track record.
• NTAP has not decreased its dividend for at least 10 years, so it has a reliable track record of non decreasing dividend.
• NTAP pays out 38.43% of its income as dividend. This is a sustainable payout ratio.
• NTAP's earnings are growing more than its dividend. This makes the dividend growth sustainable.

Analyzing Health Metrics

Every stock is evaluated by ChartMill, receiving a Health Rating on a scale of 0 to 10. This assessment considers different health aspects, including liquidity and solvency, both in absolute terms and relative to industry peers. NASDAQ:NTAP has achieved a 5 out of 10:

• NTAP has a Altman-Z score of 2.92. This is in the better half of the industry: NTAP outperforms 68.75% of its industry peers.
• NTAP has a debt to FCF ratio of 1.69. This is a very positive value and a sign of high solvency as it would only need 1.69 years to pay back of all of its debts.
• The Debt to FCF ratio of NTAP (1.69) is better than 87.50% of its industry peers.
• Even though the debt/equity ratio score it not favorable for NTAP, it has very limited outstanding debt, so we won't put too much weight on the DE evaluation.

Profitability Assessment of NASDAQ:NTAP

ChartMill's Profitability Rating offers a unique perspective on stock analysis, providing scores from 0 to 10. These ratings consider a wide range of profitability metrics and margins, both in comparison to industry peers and on their own merits. For NASDAQ:NTAP, the assigned 8 is a significant indicator of profitability:

• NTAP has a better Return On Assets (11.65%) than 81.25% of its industry peers.
• The Return On Equity of NTAP (116.79%) is better than 93.75% of its industry peers.
• NTAP's Return On Invested Capital of 22.14% is amongst the best of the industry. NTAP outperforms 87.50% of its industry peers.
• The last Return On Invested Capital (22.14%) for NTAP is above the 3 year average (15.62%), which is a sign of increasing profitability.
• The Profit Margin of NTAP (17.01%) is better than 90.63% of its industry peers.
• NTAP has a Operating Margin of 21.34%. This is amongst the best in the industry. NTAP outperforms 90.63% of its industry peers.
• NTAP has a better Gross Margin (71.11%) than 96.88% of its industry peers.
• NTAP's Gross Margin has improved in the last couple of years.

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Our latest full fundamental report of NTAP contains the most current fundamental analsysis.

Disclaimer

Important Note: The content of this article is not intended as trading advice. It is essential to perform your own analysis and exercise caution when making trading decisions. The article presents observations created by automated analysis but does not guarantee any trading or investment outcomes. Always trade responsibly and make independent judgments.