NETSCOUT SYSTEMS INC (NTCT) Stock Fundamental Analysis
USA - NASDAQ:NTCT - US64115T1043 - Common Stock
25.67 USD
-1.05 (-3.93%)
25.65 USD
-0.02 (-0.08%)
NTCT gets a fundamental rating of 5 out of 10. The analysis compared the fundamentals against 48 industry peers in the Communications Equipment industry. NTCT has an average financial health and profitability rating. NTCT is valued quite cheap, but it does not seem to be growing. This makes NTCT very considerable for value investing!
1. Profitability
1.1 Basic Checks
NTCT had positive earnings in the past year.
NTCT had a positive operating cash flow in the past year.
In multiple years NTCT reported negative net income over the last 5 years.
NTCT had a positive operating cash flow in each of the past 5 years.
1.2 Ratios
NTCT's Return On Assets of 3.37% is fine compared to the rest of the industry. NTCT outperforms 66.67% of its industry peers.
NTCT has a Return On Equity of 4.70%. This is in the better half of the industry: NTCT outperforms 60.42% of its industry peers.
NTCT has a Return On Invested Capital of 4.18%. This is in the better half of the industry: NTCT outperforms 64.58% of its industry peers.
The Average Return On Invested Capital over the past 3 years for NTCT is significantly below the industry average of 12.78%.
The last Return On Invested Capital (4.18%) for NTCT is above the 3 year average (2.83%), which is a sign of increasing profitability.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 3.37% | ||
| ROE | 4.7% | ||
| ROIC | 4.18% |
ROA(3y)-6.79%
ROA(5y)-3.72%
ROE(3y)-9.46%
ROE(5y)-5.14%
ROIC(3y)2.83%
ROIC(5y)2.2%
1.3 Margins
NTCT's Profit Margin of 8.72% is fine compared to the rest of the industry. NTCT outperforms 79.17% of its industry peers.
NTCT's Operating Margin of 11.21% is fine compared to the rest of the industry. NTCT outperforms 77.08% of its industry peers.
NTCT's Operating Margin has improved in the last couple of years.
With an excellent Gross Margin value of 78.70%, NTCT belongs to the best of the industry, outperforming 97.92% of the companies in the same industry.
NTCT's Gross Margin has been stable in the last couple of years.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 11.21% | ||
| PM (TTM) | 8.72% | ||
| GM | 78.7% |
OM growth 3Y19.56%
OM growth 5Y33.65%
PM growth 3YN/A
PM growth 5YN/A
GM growth 3Y1.45%
GM growth 5Y1.45%
2. Health
2.1 Basic Checks
The Return on Invested Capital (ROIC) is below the Cost of Capital (WACC), so NTCT is destroying value.
NTCT has more shares outstanding than it did 1 year ago.
The number of shares outstanding for NTCT remains at a similar level compared to 5 years ago.
NTCT has no outstanding debt. Therefor its Debt/Equity and Debt/FCF ratios are 0 and belong to the best of the industry.
2.2 Solvency
NTCT has an Altman-Z score of 2.48. This is not the best score and indicates that NTCT is in the grey zone with still only limited risk for bankruptcy at the moment.
NTCT has a Altman-Z score of 2.48. This is in the better half of the industry: NTCT outperforms 64.58% of its industry peers.
There is no outstanding debt for NTCT. This means it has a Debt/Equity and Debt/FCF ratio of 0 and it is amongst the best of the sector and industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0 | ||
| Debt/FCF | 0 | ||
| Altman-Z | 2.48 |
ROIC/WACC0.45
WACC9.28%
2.3 Liquidity
NTCT has a Current Ratio of 1.77. This is a normal value and indicates that NTCT is financially healthy and should not expect problems in meeting its short term obligations.
With a Current ratio value of 1.77, NTCT is not doing good in the industry: 62.50% of the companies in the same industry are doing better.
A Quick Ratio of 1.73 indicates that NTCT should not have too much problems paying its short term obligations.
NTCT has a Quick ratio (1.73) which is in line with its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 1.77 | ||
| Quick Ratio | 1.73 |
3. Growth
3.1 Past
The Earnings Per Share has grown by an nice 19.21% over the past year.
Measured over the past 5 years, NTCT shows a small growth in Earnings Per Share. The EPS has been growing by 6.94% on average per year.
The Revenue has decreased by -0.82% in the past year.
NTCT shows a decrease in Revenue. Measured over the last years, the Revenue has been decreasing by -1.60% yearly.
EPS 1Y (TTM)19.21%
EPS 3Y6.11%
EPS 5Y6.94%
EPS Q2Q%31.91%
Revenue 1Y (TTM)-0.82%
Revenue growth 3Y-1.3%
Revenue growth 5Y-1.6%
Sales Q2Q%14.6%
3.2 Future
The Earnings Per Share is expected to grow by 5.12% on average over the next years.
Based on estimates for the next years, NTCT will show a small growth in Revenue. The Revenue will grow by 3.60% on average per year.
EPS Next Y7.77%
EPS Next 2Y6.01%
EPS Next 3Y5.12%
EPS Next 5YN/A
Revenue Next Year4.21%
Revenue Next 2Y3.44%
Revenue Next 3Y3.6%
Revenue Next 5YN/A
3.3 Evolution
The EPS growth rate is decreasing: in the next years the growth will be less than in the last years.
When comparing the Revenue growth rate of the last years to the growth rate of the upcoming years, we see that the growth is accelerating.
4. Valuation
4.1 Price/Earnings Ratio
NTCT is valuated reasonably with a Price/Earnings ratio of 10.61.
93.75% of the companies in the same industry are more expensive than NTCT, based on the Price/Earnings ratio.
Compared to an average S&P500 Price/Earnings ratio of 25.51, NTCT is valued rather cheaply.
Based on the Price/Forward Earnings ratio of 10.34, the valuation of NTCT can be described as reasonable.
91.67% of the companies in the same industry are more expensive than NTCT, based on the Price/Forward Earnings ratio.
NTCT is valuated cheaply when we compare the Price/Forward Earnings ratio to 34.98, which is the current average of the S&P500 Index.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 10.61 | ||
| Fwd PE | 10.34 |
4.2 Price Multiples
Compared to the rest of the industry, the Enterprise Value to EBITDA ratio of NTCT indicates a rather cheap valuation: NTCT is cheaper than 81.25% of the companies listed in the same industry.
Compared to the rest of the industry, the Price/Free Cash Flow ratio of NTCT indicates a rather cheap valuation: NTCT is cheaper than 97.92% of the companies listed in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 7.52 | ||
| EV/EBITDA | 8.17 |
4.3 Compensation for Growth
NTCT's PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates a correct valuation of the company.
NTCT has a very decent profitability rating, which may justify a higher PE ratio.
PEG (NY)1.37
PEG (5Y)1.53
EPS Next 2Y6.01%
EPS Next 3Y5.12%
5. Dividend
5.1 Amount
NTCT does not give a dividend.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | N/A |
25.67
-1.05 (-3.93%)
Chartmill FA Rating
GICS SectorInformation Technology
GICS IndustryGroupTechnology Hardware & Equipment
GICS IndustryCommunications Equipment
Earnings (Last)
Earnings (Next)
Inst Owners92.46%
Inst Owner Change8.87%
Ins Owners3.72%
Ins Owner Change6.84%
Market Cap1.85B
Revenue(TTM)822.68M
Net Income(TTM)72.78M
Analysts76
Price Target31.69 (23.45%)
Short Float %3.5%
Short Ratio4.34
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | N/A |
Yearly DividendN/A
Dividend Growth(5Y)N/A
DPN/A
Div Incr Years0
Div Non Decr Years0
Ex-DateN/A
Surprises & Revisions
EPS beat(2)1
Avg EPS beat(2)6.48%
Min EPS beat(2)-0.04%
Max EPS beat(2)12.99%
EPS beat(4)3
Avg EPS beat(4)11.06%
Min EPS beat(4)-0.04%
Max EPS beat(4)28.89%
EPS beat(8)7
Avg EPS beat(8)34.69%
EPS beat(12)11
Avg EPS beat(12)30.88%
EPS beat(16)15
Avg EPS beat(16)29.73%
Revenue beat(2)2
Avg Revenue beat(2)1.76%
Min Revenue beat(2)1.1%
Max Revenue beat(2)2.42%
Revenue beat(4)3
Avg Revenue beat(4)3.64%
Min Revenue beat(4)-0.56%
Max Revenue beat(4)11.59%
Revenue beat(8)5
Avg Revenue beat(8)0.38%
Revenue beat(12)8
Avg Revenue beat(12)1.12%
Revenue beat(16)10
Avg Revenue beat(16)1.48%
PT rev (1m)3.17%
PT rev (3m)6.58%
EPS NQ rev (1m)0%
EPS NQ rev (3m)-8.59%
EPS NY rev (1m)0.86%
EPS NY rev (3m)2.56%
Revenue NQ rev (1m)0%
Revenue NQ rev (3m)0.72%
Revenue NY rev (1m)0.25%
Revenue NY rev (3m)1.35%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 10.61 | ||
| Fwd PE | 10.34 | ||
| P/S | 2.21 | ||
| P/FCF | 7.52 | ||
| P/OCF | 7.3 | ||
| P/B | 1.19 | ||
| P/tB | 8.11 | ||
| EV/EBITDA | 8.17 |
EPS(TTM)2.42
EY9.43%
EPS(NY)2.48
Fwd EY9.68%
FCF(TTM)3.42
FCFY13.3%
OCF(TTM)3.52
OCFY13.7%
SpS11.61
BVpS21.53
TBVpS3.16
PEG (NY)1.37
PEG (5Y)1.53
Graham Number34.24
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 3.37% | ||
| ROE | 4.7% | ||
| ROCE | 5.29% | ||
| ROIC | 4.18% | ||
| ROICexc | 5.97% | ||
| ROICexgc | N/A | ||
| OM | 11.21% | ||
| PM (TTM) | 8.72% | ||
| GM | 78.7% | ||
| FCFM | 29.4% |
ROA(3y)-6.79%
ROA(5y)-3.72%
ROE(3y)-9.46%
ROE(5y)-5.14%
ROIC(3y)2.83%
ROIC(5y)2.2%
ROICexc(3y)3.67%
ROICexc(5y)2.85%
ROICexgc(3y)N/A
ROICexgc(5y)N/A
ROCE(3y)3.58%
ROCE(5y)2.78%
ROICexgc growth 3YN/A
ROICexgc growth 5YN/A
ROICexc growth 3Y37.03%
ROICexc growth 5Y48.15%
OM growth 3Y19.56%
OM growth 5Y33.65%
PM growth 3YN/A
PM growth 5YN/A
GM growth 3Y1.45%
GM growth 5Y1.45%
F-Score9
Asset Turnover0.39
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0 | ||
| Debt/FCF | 0 | ||
| Debt/EBITDA | 0 | ||
| Cap/Depr | 11.82% | ||
| Cap/Sales | 0.88% | ||
| Interest Coverage | 34.01 | ||
| Cash Conversion | 162.61% | ||
| Profit Quality | 337.32% | ||
| Current Ratio | 1.77 | ||
| Quick Ratio | 1.73 | ||
| Altman-Z | 2.48 |
F-Score9
WACC9.28%
ROIC/WACC0.45
Cap/Depr(3y)10.43%
Cap/Depr(5y)11.55%
Cap/Sales(3y)0.91%
Cap/Sales(5y)1.19%
Profit Quality(3y)N/A
Profit Quality(5y)N/A
High Growth Momentum
Growth
EPS 1Y (TTM)19.21%
EPS 3Y6.11%
EPS 5Y6.94%
EPS Q2Q%31.91%
EPS Next Y7.77%
EPS Next 2Y6.01%
EPS Next 3Y5.12%
EPS Next 5YN/A
Revenue 1Y (TTM)-0.82%
Revenue growth 3Y-1.3%
Revenue growth 5Y-1.6%
Sales Q2Q%14.6%
Revenue Next Year4.21%
Revenue Next 2Y3.44%
Revenue Next 3Y3.6%
Revenue Next 5YN/A
EBIT growth 1Y92.87%
EBIT growth 3Y18.01%
EBIT growth 5Y31.51%
EBIT Next Year3.21%
EBIT Next 3Y4.75%
EBIT Next 5YN/A
FCF growth 1Y79.71%
FCF growth 3Y-9.6%
FCF growth 5Y0.57%
OCF growth 1Y72.2%
OCF growth 3Y-9.74%
OCF growth 5Y-0.66%
NETSCOUT SYSTEMS INC / NTCT FAQ
What is the fundamental rating for NTCT stock?
ChartMill assigns a fundamental rating of 5 / 10 to NTCT.
What is the valuation status of NETSCOUT SYSTEMS INC (NTCT) stock?
ChartMill assigns a valuation rating of 8 / 10 to NETSCOUT SYSTEMS INC (NTCT). This can be considered as Undervalued.
Can you provide the profitability details for NETSCOUT SYSTEMS INC?
NETSCOUT SYSTEMS INC (NTCT) has a profitability rating of 6 / 10.
What are the PE and PB ratios of NETSCOUT SYSTEMS INC (NTCT) stock?
The Price/Earnings (PE) ratio for NETSCOUT SYSTEMS INC (NTCT) is 10.61 and the Price/Book (PB) ratio is 1.19.
Can you provide the expected EPS growth for NTCT stock?
The Earnings per Share (EPS) of NETSCOUT SYSTEMS INC (NTCT) is expected to grow by 7.77% in the next year.