Don't overlook NETAPP INC (NASDAQ:NTAP)—it's a hidden gem with strong fundamentals and an attractive price tag.

Our stock screening tool has identified NETAPP INC (NASDAQ:NTAP) as an undervalued gem with strong fundamentals. NASDAQ:NTAP boasts decent financial health and profitability while maintaining an attractive price point. We'll break it down further.

A Closer Look at Valuation for NASDAQ:NTAP

ChartMill assigns a Valuation Rating to each stock, ranging from 0 to 10. This rating is calculated by analyzing different valuation elements, such as price to earnings and free cash flow, both in absolute terms and relative to the market and industry. In the case of NASDAQ:NTAP, the assigned 7 reflects its valuation:

• Compared to the rest of the industry, the Price/Earnings ratio of NTAP indicates a somewhat cheap valuation: NTAP is cheaper than 70.97% of the companies listed in the same industry.
• Compared to an average S&P500 Price/Earnings ratio of 29.41, NTAP is valued rather cheaply.
• The Price/Forward Earnings ratio is 11.68, which indicates a very decent valuation of NTAP.
• Compared to an average S&P500 Price/Forward Earnings ratio of 22.12, NTAP is valued a bit cheaper.
• Based on the Enterprise Value to EBITDA ratio, NTAP is valued a bit cheaper than 70.97% of the companies in the same industry.
• Compared to the rest of the industry, the Price/Free Cash Flow ratio of NTAP indicates a rather cheap valuation: NTAP is cheaper than 83.87% of the companies listed in the same industry.
• NTAP's low PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates a rather cheap valuation of the company.
• The excellent profitability rating of NTAP may justify a higher PE ratio.

What does the Profitability looks like for NASDAQ:NTAP

ChartMill employs its own Profitability Rating system for stock evaluation. This score, ranging from 0 to 10, is derived from an analysis of diverse profitability metrics and margins. In the case of NASDAQ:NTAP, the assigned 8 is noteworthy for profitability:

• Looking at the Return On Assets, with a value of 12.78%, NTAP belongs to the top of the industry, outperforming 87.10% of the companies in the same industry.
• NTAP has a better Return On Equity (129.04%) than 96.77% of its industry peers.
• NTAP has a better Return On Invested Capital (23.44%) than 83.87% of its industry peers.
• The last Return On Invested Capital (23.44%) for NTAP is above the 3 year average (15.62%), which is a sign of increasing profitability.
• NTAP has a better Profit Margin (17.78%) than 96.77% of its industry peers.
• Looking at the Operating Margin, with a value of 21.74%, NTAP belongs to the top of the industry, outperforming 93.55% of the companies in the same industry.
• NTAP has a better Gross Margin (71.10%) than 100.00% of its industry peers.
• In the last couple of years the Gross Margin of NTAP has grown nicely.

Assessing Health Metrics for NASDAQ:NTAP

To gauge a stock's financial health, ChartMill utilizes a Health Rating on a scale of 0 to 10. This comprehensive evaluation encompasses liquidity and solvency, both in absolute terms and in comparison to industry peers. NASDAQ:NTAP has earned a 5 out of 10:

• NTAP has a Altman-Z score of 2.59. This is in the better half of the industry: NTAP outperforms 67.74% of its industry peers.
• NTAP has a debt to FCF ratio of 1.45. This is a very positive value and a sign of high solvency as it would only need 1.45 years to pay back of all of its debts.
• NTAP has a better Debt to FCF ratio (1.45) than 87.10% of its industry peers.
• Even though the debt/equity ratio score it not favorable for NTAP, it has very limited outstanding debt, so we won't put too much weight on the DE evaluation.

Growth Examination for NASDAQ:NTAP

Every stock receives a Growth Rating from ChartMill, ranging from 0 to 10. This rating assesses various growth aspects, including historical and projected EPS and revenue growth. NASDAQ:NTAP boasts a 5 out of 10:

• The Earnings Per Share has grown by an nice 14.98% over the past year.
• The Earnings Per Share is expected to grow by 10.60% on average over the next years. This is quite good.
• The EPS growth rate is accelerating: in the next years the growth will be better than in the last years.
• The Revenue growth rate is accelerating: in the next years the growth will be better than in the last years.

Every day, new Decent Value stocks can be found on ChartMill in our Decent Value screener.

Check the latest full fundamental report of NTAP for a complete fundamental analysis.

Keep in mind

Important Note: The content of this article is not intended as trading advice. It is essential to perform your own analysis and exercise caution when making trading decisions. The article presents observations created by automated analysis but does not guarantee any trading or investment outcomes. Always trade responsibly and make independent judgments.