NETAPP INC (NASDAQ:NTAP) – A Reliable Dividend Stock Worth Considering

NETAPP INC (NASDAQ:NTAP) stands out as a solid choice for dividend investors, according to our Best Dividend Stocks screen. The company combines a strong dividend profile with healthy profitability and reasonable financial health, making it an attractive option for income-focused portfolios.

Dividend Strength

NTAP earns a Dividend Rating of 7, reflecting its reliable payout history and sustainable yield:

• Dividend Yield: 1.99%, slightly above the industry average of 2.03%.
• Track Record: The company has paid dividends for at least 10 years without cuts.
• Payout Ratio: A conservative 37.2% of earnings, indicating room for future growth.
• Dividend Growth: While modest at 4.43% annually, it remains consistent.

Profitability & Financial Health

NTAP’s Profitability Rating of 8 highlights strong earnings performance:

• High Margins: Gross margin of 70.6% and operating margin of 21.5% outperform most peers.
• ROE & ROA: Exceptional returns on equity (114.3%) and assets (12.7%) signal efficient operations.

Financial health is stable with a Health Rating of 5, though liquidity metrics show some weakness:

• Low Debt: Minimal debt burden, with a manageable Debt/Equity ratio of 1.25.
• Liquidity Concerns: Current and quick ratios below 1 suggest short-term cash constraints, though solvency remains intact.

Valuation & Growth

NTAP trades at a reasonable P/E of 14.1, cheaper than 75% of industry peers. Earnings growth (12.2% annually) supports its valuation, though revenue growth is slower at ~4%.

For a deeper dive, review the full fundamental report on NTAP.

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Disclaimer

This is not investment advice. Always conduct your own research before making decisions.