Exploring NASDAQ:NTAP's dividend characteristics.

Last update: Dec 2, 2024

Our stock screener has spotted NETAPP INC (NASDAQ:NTAP) as a good dividend stock with solid fundamentals. NASDAQ:NTAP shows decent health and profitability. At the same time it gives a good and sustainable dividend. We'll dive into each aspect below.

A Closer Look at Dividend for NASDAQ:NTAP

ChartMill assigns a proprietary Dividend Rating to each stock. The score is computed by evaluating various valuation aspects, like the yield, the history, the dividend growth and sustainability. NASDAQ:NTAP was assigned a score of 7 for dividend:

NTAP's Dividend Yield is rather good when compared to the industry average which is at 2.87. NTAP pays more dividend than 80.65% of the companies in the same industry.
NTAP has been paying a dividend for at least 10 years, so it has a reliable track record.
NTAP has not decreased their dividend for at least 10 years, which is a reliable track record.
NTAP pays out 38.43% of its income as dividend. This is a sustainable payout ratio.
NTAP's earnings are growing more than its dividend. This makes the dividend growth sustainable.

Assessing Health Metrics for NASDAQ:NTAP

ChartMill employs its own Health Rating for stock assessment. This rating, ranging from 0 to 10, is calculated by examining various liquidity and solvency ratios. In the case of NASDAQ:NTAP, the assigned 5 reflects its health status:

The Altman-Z score of NTAP (2.94) is better than 77.42% of its industry peers.
The Debt to FCF ratio of NTAP is 1.69, which is an excellent value as it means it would take NTAP, only 1.69 years of fcf income to pay off all of its debts.
Looking at the Debt to FCF ratio, with a value of 1.69, NTAP belongs to the top of the industry, outperforming 80.65% of the companies in the same industry.
Although NTAP does not score too well on debt/equity it has very limited outstanding debt, which is well covered by the FCF. We will not put too much weight on the debt/equity number as it may be because of low equity, which could be a consequence of a share buyback program for instance. This needs to be investigated.

Assessing Profitability for NASDAQ:NTAP

ChartMill assigns a proprietary Profitability Rating to each stock. The score is computed by evaluating various profitability ratios and margins and ranges from 0 to 10. NASDAQ:NTAP was assigned a score of 8 for profitability:

NTAP has a Return On Assets of 11.65%. This is amongst the best in the industry. NTAP outperforms 87.10% of its industry peers.
NTAP's Return On Equity of 116.79% is amongst the best of the industry. NTAP outperforms 96.77% of its industry peers.
The Return On Invested Capital of NTAP (22.14%) is better than 87.10% of its industry peers.
The last Return On Invested Capital (22.14%) for NTAP is above the 3 year average (15.62%), which is a sign of increasing profitability.
NTAP has a better Profit Margin (17.01%) than 93.55% of its industry peers.
NTAP has a better Operating Margin (21.34%) than 90.32% of its industry peers.
NTAP's Gross Margin of 71.11% is amongst the best of the industry. NTAP outperforms 96.77% of its industry peers.
NTAP's Gross Margin has improved in the last couple of years.

More Best Dividend stocks can be found in our Best Dividend screener.

Our latest full fundamental report of NTAP contains the most current fundamental analsysis.

Keep in mind

This is not investing advice! The article highlights some of the observations at the time of writing, but you should always make your own analysis and invest based on your own insights.