NetApp Second Quarter Earnings Sneak Peek

S&P 500 (NYSE:SPY) component NetApp (NASDAQ:NTAP) will unveil its latest earnings on Wednesday, November 14, 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 profit of 33 cents per share, a decline of 34% 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 34 cents. Between one and three months ago, the average estimate was unchanged. It has since dropped over the last month. Analysts are projecting profit to rise by 22.5% versus last year to $1.45.

Past Earnings Performance: Last quarter, the company fell short of estimates by 5 cents, coming in at net income of 23 cents per share against a mean estimate of profit of 25 cents. The company topped expectations in the fourth quarter of the last fiscal year.

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A Look Back: In the first quarter, profit fell 54.3% to $63.8 million (17 cents a share) from $139.5 million (34 cents a share) the year earlier, missing analyst expectations. Revenue fell 0.9% to $1.44 billion from $1.46 billion.

Stock Price Performance: Between September 13, 2012 and November 8, 2012, the stock price had fallen $7.97 (-22.6%), from $35.28 to $27.31. It saw one of its worst periods between October 1, 2012 and October 12, 2012 when shares fell for 10 straight days, dropping 12.2% (-$4.01) over that span.

Analyst Ratings: There are mostly holds on the stock with 19 of 27 analysts surveyed giving that rating.

Key Stats:

On the top line, the company is looking to get back on the right track after last quarter’s drop snapped a string of revenue increases. Revenue rose 24.8% in the second quarter of the last fiscal year, 23.5% in the third quarter of the last fiscal year and 12.8%in the fourth quarter of the last fiscal year before dropping in the first quarter.

The company is trying to use this earnings announcement to rebound from profit declines in the last three quarters. Net income fell 30.7% in the third quarter of the last fiscal year, by 7% in the fourth quarter of the last fiscal year and again in the first quarter.

Wall St. Revenue Expectations: Analysts predict a rise of 2% in revenue from the year-earlier quarter to $1.54 billion.

Balance Sheet Analysis: The company’s current ratio of assets to liabilities came in at 1.95 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.

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

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