NETSCOUT SYSTEMS INC (NTCT) Stock Fundamental Analysis
USA - NASDAQ:NTCT - US64115T1043 - Common Stock
27.8 USD
-0.25 (-0.89%)
28 USD
+0.2 (+0.72%)
We assign a fundamental rating of 5 out of 10 to NTCT. NTCT was compared to 48 industry peers in the Communications Equipment industry. NTCT has only an average score on both its financial health and profitability. NTCT is valued quite cheap, but it does not seem to be growing. These ratings could make NTCT a good candidate for value investing.
1. Profitability
1.1 Basic Checks
NTCT had positive earnings in the past year.
In the past year NTCT had a positive cash flow from operations.
In multiple years NTCT reported negative net income over the last 5 years.
Each year in the past 5 years NTCT had a positive operating cash flow.
1.2 Ratios
NTCT has a Return On Assets of 3.37%. This is in the better half of the industry: NTCT outperforms 64.58% of its industry peers.
Looking at the Return On Equity, with a value of 4.70%, NTCT is in the better half of the industry, outperforming 64.58% of the companies in the same industry.
Looking at the Return On Invested Capital, with a value of 4.18%, NTCT is in the better half of the industry, outperforming 68.75% of the companies in the same industry.
Measured over the past 3 years, the Average Return On Invested Capital for NTCT is significantly below the industry average of 12.95%.
The 3 year average ROIC (2.83%) for NTCT is below the current ROIC(4.18%), indicating increased profibility in the last year.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 3.37% | ||
| ROE | 4.7% | ||
| ROIC | 4.18% |
ROA(3y)-6.79%
ROA(5y)-3.72%
ROE(3y)-9.46%
ROE(5y)-5.14%
ROIC(3y)2.83%
ROIC(5y)2.2%
1.3 Margins
With a decent Profit Margin value of 8.72%, NTCT is doing good in the industry, outperforming 75.00% of the companies in the same industry.
NTCT has a better Operating Margin (11.21%) than 77.08% of its industry peers.
NTCT's Operating Margin has improved in the last couple of years.
Looking at the Gross Margin, with a value of 78.70%, NTCT belongs to the top of the industry, outperforming 97.92% of the companies in the same industry.
In the last couple of years the Gross Margin of NTCT has remained more or less at the same level.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 11.21% | ||
| PM (TTM) | 8.72% | ||
| GM | 78.7% |
OM growth 3Y19.56%
OM growth 5Y33.65%
PM growth 3YN/A
PM growth 5YN/A
GM growth 3Y1.45%
GM growth 5Y1.45%
2. Health
2.1 Basic Checks
The Return on Invested Capital (ROIC) is below the Cost of Capital (WACC), so NTCT is destroying value.
Compared to 1 year ago, NTCT has more shares outstanding
Compared to 5 years ago, NTCT has about the same amount of shares outstanding.
There is no outstanding debt for NTCT. This means it has a Debt/Equity and Debt/FCF ratio of 0 and it is amongst the best of the sector and industry.
2.2 Solvency
NTCT has an Altman-Z score of 2.65. This is not the best score and indicates that NTCT is in the grey zone with still only limited risk for bankruptcy at the moment.
NTCT has a Altman-Z score (2.65) which is in line with its industry peers.
NTCT has no outstanding debt. Therefor its Debt/Equity and Debt/FCF ratios are 0 and belong to the best of the industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0 | ||
| Debt/FCF | 0 | ||
| Altman-Z | 2.65 |
ROIC/WACC0.46
WACC9.16%
2.3 Liquidity
NTCT has a Current Ratio of 1.77. This is a normal value and indicates that NTCT is financially healthy and should not expect problems in meeting its short term obligations.
NTCT has a Current ratio (1.77) which is comparable to the rest of the industry.
A Quick Ratio of 1.73 indicates that NTCT should not have too much problems paying its short term obligations.
With a decent Quick ratio value of 1.73, NTCT is doing good in the industry, outperforming 60.42% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 1.77 | ||
| Quick Ratio | 1.73 |
3. Growth
3.1 Past
The Earnings Per Share has been growing slightly by 4.61% over the past year.
The Earnings Per Share has been growing slightly by 6.94% on average over the past years.
Looking at the last year, NTCT shows a small growth in Revenue. The Revenue has grown by 5.29% in the last year.
NTCT shows a decrease in Revenue. Measured over the last years, the Revenue has been decreasing by -1.60% yearly.
EPS 1Y (TTM)4.61%
EPS 3Y6.11%
EPS 5Y6.94%
EPS Q2Q%21.43%
Revenue 1Y (TTM)5.29%
Revenue growth 3Y-1.3%
Revenue growth 5Y-1.6%
Sales Q2Q%6.98%
3.2 Future
The Earnings Per Share is expected to grow by 5.99% on average over the next years.
Based on estimates for the next years, NTCT will show a small growth in Revenue. The Revenue will grow by 4.38% on average per year.
EPS Next Y7.77%
EPS Next 2Y6.01%
EPS Next 3Y5.99%
EPS Next 5YN/A
Revenue Next Year4.21%
Revenue Next 2Y3.44%
Revenue Next 3Y4.38%
Revenue Next 5YN/A
3.3 Evolution
When comparing the EPS growth rate of the last years to the growth rate of the upcoming years, we see that the growth is stable.
When comparing the Revenue growth rate of the last years to the growth rate of the upcoming years, we see that the growth is accelerating.
4. Valuation
4.1 Price/Earnings Ratio
NTCT is valuated correctly with a Price/Earnings ratio of 12.25.
Based on the Price/Earnings ratio, NTCT is valued cheaper than 87.50% of the companies in the same industry.
The average S&P500 Price/Earnings ratio is at 26.10. NTCT is valued rather cheaply when compared to this.
A Price/Forward Earnings ratio of 11.19 indicates a reasonable valuation of NTCT.
Based on the Price/Forward Earnings ratio, NTCT is valued cheaper than 93.75% of the companies in the same industry.
When comparing the Price/Forward Earnings ratio of NTCT to the average of the S&P500 Index (22.52), we can say NTCT is valued rather cheaply.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 12.25 | ||
| Fwd PE | 11.19 |
4.2 Price Multiples
Compared to the rest of the industry, the Enterprise Value to EBITDA ratio of NTCT indicates a rather cheap valuation: NTCT is cheaper than 83.33% of the companies listed in the same industry.
NTCT's Price/Free Cash Flow ratio is rather cheap when compared to the industry. NTCT is cheaper than 95.83% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 8.14 | ||
| EV/EBITDA | 9.27 |
4.3 Compensation for Growth
NTCT's PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates a correct valuation of the company.
The decent profitability rating of NTCT may justify a higher PE ratio.
PEG (NY)1.58
PEG (5Y)1.76
EPS Next 2Y6.01%
EPS Next 3Y5.99%
5. Dividend
5.1 Amount
No dividends for NTCT!.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | N/A |
27.8
-0.25 (-0.89%)
Chartmill FA Rating
GICS SectorInformation Technology
GICS IndustryGroupTechnology Hardware & Equipment
GICS IndustryCommunications Equipment
Earnings (Last)
Earnings (Next)
Inst Owners92.46%
Inst Owner Change-0.36%
Ins Owners3.72%
Ins Owner Change5.25%
Market Cap2.00B
Revenue(TTM)834.86M
Net Income(TTM)72.78M
Analysts76
Price Target30.71 (10.47%)
Short Float %3.48%
Short Ratio4.42
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | N/A |
Yearly DividendN/A
Dividend Growth(5Y)N/A
DPN/A
Div Incr Years0
Div Non Decr Years0
Ex-DateN/A
Surprises & Revisions
EPS beat(2)1
Avg EPS beat(2)6.48%
Min EPS beat(2)-0.04%
Max EPS beat(2)12.99%
EPS beat(4)3
Avg EPS beat(4)11.06%
Min EPS beat(4)-0.04%
Max EPS beat(4)28.89%
EPS beat(8)7
Avg EPS beat(8)34.69%
EPS beat(12)11
Avg EPS beat(12)30.88%
EPS beat(16)15
Avg EPS beat(16)29.73%
Revenue beat(2)2
Avg Revenue beat(2)1.76%
Min Revenue beat(2)1.1%
Max Revenue beat(2)2.42%
Revenue beat(4)3
Avg Revenue beat(4)3.64%
Min Revenue beat(4)-0.56%
Max Revenue beat(4)11.59%
Revenue beat(8)5
Avg Revenue beat(8)0.38%
Revenue beat(12)8
Avg Revenue beat(12)1.12%
Revenue beat(16)10
Avg Revenue beat(16)1.48%
PT rev (1m)0%
PT rev (3m)3.3%
EPS NQ rev (1m)0%
EPS NQ rev (3m)-15.56%
EPS NY rev (1m)0.86%
EPS NY rev (3m)2.56%
Revenue NQ rev (1m)0%
Revenue NQ rev (3m)0.49%
Revenue NY rev (1m)0.66%
Revenue NY rev (3m)1.35%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 12.25 | ||
| Fwd PE | 11.19 | ||
| P/S | 2.39 | ||
| P/FCF | 8.14 | ||
| P/OCF | 7.9 | ||
| P/B | 1.29 | ||
| P/tB | 8.78 | ||
| EV/EBITDA | 9.27 |
EPS(TTM)2.27
EY8.17%
EPS(NY)2.48
Fwd EY8.93%
FCF(TTM)3.42
FCFY12.29%
OCF(TTM)3.52
OCFY12.65%
SpS11.61
BVpS21.53
TBVpS3.16
PEG (NY)1.58
PEG (5Y)1.76
Graham Number33.16
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 3.37% | ||
| ROE | 4.7% | ||
| ROCE | 5.29% | ||
| ROIC | 4.18% | ||
| ROICexc | 5.97% | ||
| ROICexgc | N/A | ||
| OM | 11.21% | ||
| PM (TTM) | 8.72% | ||
| GM | 78.7% | ||
| FCFM | 29.4% |
ROA(3y)-6.79%
ROA(5y)-3.72%
ROE(3y)-9.46%
ROE(5y)-5.14%
ROIC(3y)2.83%
ROIC(5y)2.2%
ROICexc(3y)3.67%
ROICexc(5y)2.85%
ROICexgc(3y)N/A
ROICexgc(5y)N/A
ROCE(3y)3.58%
ROCE(5y)2.78%
ROICexgc growth 3YN/A
ROICexgc growth 5YN/A
ROICexc growth 3Y37.03%
ROICexc growth 5Y48.15%
OM growth 3Y19.56%
OM growth 5Y33.65%
PM growth 3YN/A
PM growth 5YN/A
GM growth 3Y1.45%
GM growth 5Y1.45%
F-Score9
Asset Turnover0.39
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0 | ||
| Debt/FCF | 0 | ||
| Debt/EBITDA | 0 | ||
| Cap/Depr | 11.82% | ||
| Cap/Sales | 0.88% | ||
| Interest Coverage | 34.01 | ||
| Cash Conversion | 162.61% | ||
| Profit Quality | 337.32% | ||
| Current Ratio | 1.77 | ||
| Quick Ratio | 1.73 | ||
| Altman-Z | 2.65 |
F-Score9
WACC9.16%
ROIC/WACC0.46
Cap/Depr(3y)10.43%
Cap/Depr(5y)11.55%
Cap/Sales(3y)0.91%
Cap/Sales(5y)1.19%
Profit Quality(3y)N/A
Profit Quality(5y)N/A
High Growth Momentum
Growth
EPS 1Y (TTM)4.61%
EPS 3Y6.11%
EPS 5Y6.94%
EPS Q2Q%21.43%
EPS Next Y7.77%
EPS Next 2Y6.01%
EPS Next 3Y5.99%
EPS Next 5YN/A
Revenue 1Y (TTM)5.29%
Revenue growth 3Y-1.3%
Revenue growth 5Y-1.6%
Sales Q2Q%6.98%
Revenue Next Year4.21%
Revenue Next 2Y3.44%
Revenue Next 3Y4.38%
Revenue Next 5YN/A
EBIT growth 1Y92.87%
EBIT growth 3Y18.01%
EBIT growth 5Y31.51%
EBIT Next Year3.21%
EBIT Next 3Y6.03%
EBIT Next 5YN/A
FCF growth 1Y79.71%
FCF growth 3Y-9.6%
FCF growth 5Y0.57%
OCF growth 1Y72.2%
OCF growth 3Y-9.74%
OCF growth 5Y-0.66%
NETSCOUT SYSTEMS INC / NTCT FAQ
What is the fundamental rating for NTCT stock?
ChartMill assigns a fundamental rating of 5 / 10 to NTCT.
What is the valuation status of NETSCOUT SYSTEMS INC (NTCT) stock?
ChartMill assigns a valuation rating of 7 / 10 to NETSCOUT SYSTEMS INC (NTCT). This can be considered as Undervalued.
Can you provide the profitability details for NETSCOUT SYSTEMS INC?
NETSCOUT SYSTEMS INC (NTCT) has a profitability rating of 6 / 10.
What are the PE and PB ratios of NETSCOUT SYSTEMS INC (NTCT) stock?
The Price/Earnings (PE) ratio for NETSCOUT SYSTEMS INC (NTCT) is 12.25 and the Price/Book (PB) ratio is 1.29.
Can you provide the expected EPS growth for NTCT stock?
The Earnings per Share (EPS) of NETSCOUT SYSTEMS INC (NTCT) is expected to grow by 7.77% in the next year.