NetApp First Quarter Earnings Sneak Peek

S&P 500 (NYSE:SPY) component NetApp (NASDAQ:NTAP) will unveil its latest earnings on Wednesday, August 15, 2012. NetApp supplies enterprise storage and data management software and hardware products and services.

NetApp Earnings Preview Cheat Sheet

Wall St. Earnings Expectations: The average estimate of analysts is for net income of 25 cents per share, a decline of 43.2% from the company’s actual earnings for the same quarter a year ago. During the past three months, the average estimate has moved down from 45 cents. Between one and three months ago, the average estimate moved down. It has been unchanged at 25 cents during the last month. Analysts are projecting profit to rise by 17.1% versus last year to $1.55.

Past Earnings Performance: The company topped estimates last quarter after missing forecasts the quarter prior. In the fourth quarter of the last fiscal year, it reported profit of 54 cents per share against a mean estimate of net income of 49 cents per share. In the third quarter of the last fiscal year, it missed forecasts by 5 cents.

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Balance Sheet Analysis: The company’s current ratio of assets to liabilities came in at 1.94 last quarter. The current ratio is an indication of a firm’s liquidity and ability to meet creditor demands and generally, for every dollar the company owes in the short term, it has that figure available in assets that can be converted to cash in the short term. The company regressed in this liquidity measure from 2.86 in the third quarter of the last fiscal year to the last quarter driven in part by an increase in liabilities. Current liabilities increased 63.1% to $3.52 billion while assets rose 10.7% to $6.83 billion.

Stock Price Performance: From July 12, 2012 to August 9, 2012, the stock price rose $3.76 (13.3%), from $28.37 to $32.13. It saw one of its worst periods between May 1, 2012 and May 10, 2012 when shares fell for eight straight days, dropping 12.2% (-$4.98) over that span.

A Look Back: In the fourth quarter of the last fiscal year, profit fell 7% to $180.7 million (48 cents a share) from $194.2 million (48 cents a share) the year earlier, but exceeded analyst expectations. Revenue rose 12.8% to $1.7 billion from $1.51 billion.

Key Stats:

With double-digit revenue growth the past four quarters, this earnings release is a chance to keep that positive trend going. The company has averaged year-over-year revenue growth of 22.3% over the last four quarters.

An income boost this time around would be welcome news after profit declines in the past two quarters. Net income dropped 30.7% in the third quarter of the last fiscal year and then again in the fourth quarter of the last fiscal year.

Analyst Ratings: There are mostly holds on the stock with 17 of 28 analysts surveyed giving that rating.

Wall St. Revenue Expectations: Analysts predict no change in revenue from the year-earlier quarter to $1.46 billion.

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(Company fundamentals by Xignite Financials. Earnings estimates provided by Zacks)

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