NTAP Stock | | | USD 99.42 1.51 1.54% |
This module uses fundamental data of NetApp to approximate the value of its Beneish M Score. NetApp M Score tells investors if the company management is likely to be manipulating earnings. The score is calculated using eight financial indicators that are adjusted by a specific multiplier. Please note, the M Score is a probabilistic model and cannot detect companies that manipulate their earnings with 100% accuracy. Check out
NetApp Piotroski F Score and
NetApp Altman Z Score analysis.
At this time, NetApp's
Total Debt To Capitalization is relatively stable compared to the past year. As of 04/24/2024,
Debt Equity Ratio is likely to grow to 4.11, while
Short and Long Term Debt is likely to drop slightly above 213.8
M. At this time, NetApp's
Free Cash Flow Per Share is relatively stable compared to the past year. As of 04/24/2024,
ROIC is likely to grow to 0.24, while
Stock Based Compensation To Revenue is likely to drop 0.03.
At this time, it appears that NetApp Inc is an unlikely manipulator. The earnings manipulation may begin if NetApp's top management creates an artificial sense of financial success, forcing the stock price to be traded at a high price-earnings multiple than it should be. In general, excessive earnings management by NetApp executives may lead to removing some of the operating profits from subsequent periods to inflate earnings in the following periods. This way, the manipulation of NetApp's earnings can lead to misrepresentations of actual financial condition, taking the otherwise loyal stakeholders on to the path of questionable ethical practices and plain fraud.
-2.9
Beneish M Score - Unlikely Manipulator
| Elasticity of Receivables | 1.01 | Focus |
| Expense Coverage | 1.33 | Focus |
| Gross Margin Strengs | 0.75 | Focus |
| Depreciation Resistance | 0.97 | Focus |
| Net Sales Growth | 0.53 | Focus |
| Financial Leverage Condition | 1.02 | Focus |
NetApp Beneish M-Score Indicator Trends
The cure to earnings manipulation is the transparency of financial reporting. It will typically remove the temptation of the top executives to inflate earnings (i.e., to promote the idea of 'winning at any cost'). Because a healthy internal audit department can enhance transparency, the board should promote the auditors' access to all the record-keeping systems across the enterprise. For example, if NetApp's auditors report directly to the board (not management), the managers will be reluctant to manipulate simply due to the fear of punishment. On the other hand, the auditors will be free to investigate the ledgers properly because they know that the board has their back.
NetApp Inc Beneish M-Score Driver Matrix
One of the toughest challenges investors face today is learning how to quickly synthesize historical
financial statements and information provided by the company, SEC reporting, and various external parties in order to detect the potential manipulation of earnings. Understanding the correlation between NetApp's different financial indicators related to revenue, expenses, operating profit, and net earnings helps investors identify and prioritize their investing strategies towards NetApp in a much-optimized way. Analyzing correlations between earnings drivers directly associated with dollar figures is the most effective way to find NetApp's degree of accounting gimmicks and manipulations.
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About NetApp Beneish M Score
M-Score is one of many grading techniques for value stocks. It was developed by Professor M. Daniel Beneish of the Kelley School of Business at Indiana University and published in 1999 under the paper titled
The Detection of Earnings Manipulation. The Beneish score is a multi-factor model that utilizes financial identifiers to compile eight variables used to classify whether a company has manipulated its reported earnings. The variables are built from the officially filed
financial statements to create a final score call 'M Score.' The score helps to identify companies that are likely to manipulate their profits if they show deteriorating gross margins, operating expenses, and leverage against growing revenue.
NetApp Earnings Manipulation Drivers
Although earnings manipulation is typically not the result of intentional misconduct by the c-level executives, it is still a widespread practice by the senior management of public companies such as NetApp. It is usually done by a series of misrepresentations of various accounting rules and operating activities across multiple financial cycles. The best way to spot the manipulation is to examine the historical financial statement to find inconsistencies in earning reports to find trends in assets or liabilities that are not sustainable in the future.
NetApp ESG Sustainability
Some studies have found that companies with high sustainability scores are getting higher valuations than competitors with lower social-engagement activities. While most ESG disclosures are voluntary and do not directly affect the long term financial condition, NetApp's sustainability indicators can be used to identify proper investment strategies using environmental, social, and governance scores that are crucial to NetApp's managers, analysts, and investors.
About NetApp Fundamental Analysis
The Macroaxis Fundamental Analysis modules help investors analyze NetApp Inc's financials across various querterly and yearly statements, indicators and fundamental ratios. We help investors to determine the real value of NetApp using virtually all public information available. We use both quantitative as well as qualitative analysis to arrive at
the intrinsic value of NetApp Inc based on its fundamental data. In general, a quantitative approach, as applied to this company, focuses on analyzing
financial statements comparatively, whereas a qaualitative method uses data that is important to a company's growth but cannot be measured and presented in a numerical way.
Please read more on our
fundamental analysis page.
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Try AI Portfolio ArchitectWhen determining whether NetApp Inc is a good investment, qualitative aspects like company
management, corporate governance, and ethical practices play a significant role. A
comparison with peer companies also provides context and helps to understand if NetApp Stock is undervalued or overvalued. This multi-faceted approach, blending both quantitative and qualitative analysis, forms a solid foundation for making an informed investment decision about Netapp Inc Stock.
Highlighted below are key reports to facilitate an investment decision about Netapp Inc Stock: Check out
NetApp Piotroski F Score and
NetApp Altman Z Score analysis.
Note that the NetApp Inc information on this page should be used as a complementary analysis to other NetApp's statistical models used to find the right mix of equity instruments to add to your existing portfolios or create a brand new portfolio. You can also try the
Commodity Channel module to use Commodity Channel Index to analyze current equity momentum.
Complementary Tools for NetApp Stock analysis
When running NetApp's price analysis, check to
measure NetApp's market volatility, profitability, liquidity, solvency, efficiency, growth potential, financial leverage, and other vital indicators. We have many different tools that can be utilized to determine how healthy NetApp is operating at the current time. Most of NetApp's value examination focuses on studying past and present price action to
predict the probability of NetApp's future price movements. You can analyze the entity against its peers and the financial market as a whole to determine factors that move NetApp's price. Additionally, you may evaluate how the addition of NetApp to your portfolios can decrease your overall portfolio volatility.
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Is NetApp's industry expected to grow? Or is there an opportunity to expand the business' product line in the future? Factors like these will boost
the valuation of NetApp. If investors know NetApp will grow in the future, the company's valuation will be higher. The financial industry is built on trying to define current growth potential and future valuation accurately. All the valuation information about NetApp listed above have to be considered, but the key to understanding future value is determining which factors weigh more heavily than others.
Quarterly Earnings Growth | Dividend Share | Earnings Share | Revenue Per Share | Quarterly Revenue Growth |
The market value of NetApp Inc is measured differently than its book value, which is the value of NetApp that is recorded on the company's balance sheet. Investors also form their own opinion of NetApp's value that differs from its market value or its book value, called intrinsic value, which is NetApp's true underlying value. Investors use various methods to calculate intrinsic value and buy a stock when its market value falls below its intrinsic value. Because NetApp's market value can be influenced by many factors that don't directly affect NetApp's underlying business (such as a pandemic or basic market pessimism), market value can vary widely from intrinsic value.
Please note, there is a significant difference between NetApp's value and its price as these two are different measures arrived at by different means. Investors typically determine
if NetApp is a good investment by looking at such factors as earnings, sales, fundamental and technical indicators, competition as well as analyst projections. However, NetApp's price is the amount at which it trades on the open market and represents the number that a seller and buyer find agreeable to each party.