NETSCOUT SYSTEMS INC (NTCT) Stock Fundamental Analysis
NASDAQ:NTCT - Nasdaq - US64115T1043 - Common Stock - Currency: USD
We assign a fundamental rating of 4 out of 10 to NTCT. NTCT was compared to 51 industry peers in the Communications Equipment industry. NTCT has only an average score on both its financial health and profitability. NTCT has a valuation in line with the averages, but it does not seem to be growing.
1. Profitability
1.1 Basic Checks
In the past year NTCT was profitable.
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.
NTCT had a positive operating cash flow in each of the past 5 years.
1.2 Ratios
NTCT has a Return On Assets of -28.94%. This is amonst the worse of the industry: NTCT underperforms 82.35% of its industry peers.
With a Return On Equity value of -41.07%, NTCT is not doing good in the industry: 70.59% of the companies in the same industry are doing better.
The Return On Invested Capital of NTCT (2.15%) is better than 64.71% of its industry peers.
Measured over the past 3 years, the Average Return On Invested Capital for NTCT is significantly below the industry average of 11.02%.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | -28.94% | ||
| ROE | -41.07% | ||
| ROIC | 2.15% |
ROA(3y)-0.82%
ROA(5y)-0.38%
ROE(3y)-1.04%
ROE(5y)-0.46%
ROIC(3y)2.33%
ROIC(5y)1.77%
1.3 Margins
NTCT has a better Operating Margin (5.41%) than 66.67% of its industry peers.
NTCT's Operating Margin has improved in the last couple of years.
The Gross Margin of NTCT (77.08%) is better than 98.04% of its industry peers.
NTCT's Gross Margin has been stable in the last couple of years.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 5.41% | ||
| PM (TTM) | N/A | ||
| GM | 77.08% |
OM growth 3Y19.68%
OM growth 5YN/A
PM growth 3YN/A
PM growth 5YN/A
GM growth 3Y1.84%
GM growth 5Y1.44%
2. Health
2.1 Basic Checks
NTCT has a Return on Invested Capital (ROIC), which is below the Cost of Capital (WACC), which means it is destroying value.
Compared to 1 year ago, NTCT has more shares outstanding
NTCT has less shares outstanding than it did 5 years ago.
NTCT has a worse debt/assets ratio than last year.
2.2 Solvency
An Altman-Z score of 2.08 indicates that NTCT is not a great score, but indicates only limited risk for bankruptcy at the moment.
The Altman-Z score of NTCT (2.08) is better than 62.75% of its industry peers.
NTCT has a debt to FCF ratio of 0.55. This is a very positive value and a sign of high solvency as it would only need 0.55 years to pay back of all of its debts.
NTCT has a better Debt to FCF ratio (0.55) than 78.43% of its industry peers.
A Debt/Equity ratio of 0.05 indicates that NTCT is not too dependend on debt financing.
The Debt to Equity ratio of NTCT (0.05) is better than 64.71% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.05 | ||
| Debt/FCF | 0.55 | ||
| Altman-Z | 2.08 |
ROIC/WACC0.23
WACC9.5%
2.3 Liquidity
NTCT has a Current Ratio of 1.68. This is a normal value and indicates that NTCT is financially healthy and should not expect problems in meeting its short term obligations.
Looking at the Current ratio, with a value of 1.68, NTCT is doing worse than 64.71% of the companies in the same industry.
A Quick Ratio of 1.63 indicates that NTCT should not have too much problems paying its short term obligations.
NTCT has a better Quick ratio (1.63) than 62.75% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 1.68 | ||
| Quick Ratio | 1.63 |
3. Growth
3.1 Past
The earnings per share for NTCT have decreased strongly by -11.74% in the last year.
The Earnings Per Share has been growing by 9.62% on average over the past years. This is quite good.
NTCT shows a very negative growth in Revenue. In the last year, the Revenue has decreased by -11.10%.
The Revenue has been decreasing by -1.83% on average over the past years.
EPS 1Y (TTM)-11.74%
EPS 3Y8.97%
EPS 5Y9.62%
EPS Q2Q%-22.95%
Revenue 1Y (TTM)-11.1%
Revenue growth 3Y-0.07%
Revenue growth 5Y-1.83%
Sales Q2Q%-2.89%
3.2 Future
NTCT is expected to show a small growth in Earnings Per Share. In the coming years, the EPS will grow by 1.19% yearly.
NTCT is expected to show a small growth in Revenue. In the coming years, the Revenue will grow by 2.44% yearly.
EPS Next Y0.76%
EPS Next 2Y1.45%
EPS Next 3Y1.19%
EPS Next 5YN/A
Revenue Next Year-3.53%
Revenue Next 2Y-0.64%
Revenue Next 3Y0.04%
Revenue Next 5Y2.44%
3.3 Evolution
The EPS growth rate is decreasing: in the next years the growth will be less than in the last years.
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
A Price/Earnings ratio of 12.34 indicates a correct valuation of NTCT.
Based on the Price/Earnings ratio, NTCT is valued cheaper than 96.08% of the companies in the same industry.
Compared to an average S&P500 Price/Earnings ratio of 28.51, NTCT is valued rather cheaply.
NTCT is valuated reasonably with a Price/Forward Earnings ratio of 11.07.
92.16% of the companies in the same industry are more expensive than NTCT, based on the Price/Forward Earnings ratio.
NTCT's Price/Forward Earnings ratio indicates a rather cheap valuation when compared to the S&P500 average which is at 93.88.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 12.34 | ||
| Fwd PE | 11.07 |
4.2 Price Multiples
Based on the Enterprise Value to EBITDA ratio, NTCT is valued cheaply inside the industry as 80.39% of the companies are valued more expensively.
NTCT's Price/Free Cash Flow ratio is rather cheap when compared to the industry. NTCT is cheaper than 84.31% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 13.22 | ||
| EV/EBITDA | 10.76 |
4.3 Compensation for Growth
The high PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates an expensive valuation of the company.
PEG (NY)16.17
PEG (5Y)1.28
EPS Next 2Y1.45%
EPS Next 3Y1.19%
5. Dividend
5.1 Amount
No dividends for NTCT!.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | N/A |
NETSCOUT SYSTEMS INC
NASDAQ:NTCT (1/30/2025, 8:00:01 PM)
After market: 25.3 +0.24 (+0.96%)25.06
+2.71 (+12.13%)
Chartmill FA Rating
GICS SectorInformation Technology
GICS IndustryGroupTechnology Hardware & Equipment
GICS IndustryCommunications Equipment
Earnings (Last)
Earnings (Next)
Inst Owners92.52%
Inst Owner Change-0.43%
Ins Owners3.74%
Ins Owner Change1.66%
Market Cap1.80B
Analysts47.5
Price Target28.37 (13.21%)
Short Float %2.05%
Short Ratio3.69
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)2
Avg EPS beat(2)65.58%
Min EPS beat(2)2.4%
Max EPS beat(2)128.76%
EPS beat(4)4
Avg EPS beat(4)56.39%
Min EPS beat(4)2.4%
Max EPS beat(4)128.76%
EPS beat(8)8
Avg EPS beat(8)39.33%
EPS beat(12)12
Avg EPS beat(12)34.31%
EPS beat(16)15
Avg EPS beat(16)29.02%
Revenue beat(2)1
Avg Revenue beat(2)0.51%
Min Revenue beat(2)-0.56%
Max Revenue beat(2)1.59%
Revenue beat(4)2
Avg Revenue beat(4)0.4%
Min Revenue beat(4)-7.2%
Max Revenue beat(4)7.77%
Revenue beat(8)4
Avg Revenue beat(8)-0.24%
Revenue beat(12)6
Avg Revenue beat(12)0.66%
Revenue beat(16)8
Avg Revenue beat(16)0.36%
PT rev (1m)2.33%
PT rev (3m)27.75%
EPS NQ rev (1m)0%
EPS NQ rev (3m)-1.38%
EPS NY rev (1m)0%
EPS NY rev (3m)0.15%
Revenue NQ rev (1m)0%
Revenue NQ rev (3m)-1.04%
Revenue NY rev (1m)0%
Revenue NY rev (3m)0.32%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 12.34 | ||
| Fwd PE | 11.07 | ||
| P/S | 2.28 | ||
| P/FCF | 13.22 | ||
| P/OCF | 12.64 | ||
| P/B | 1.23 | ||
| P/tB | 17.9 | ||
| EV/EBITDA | 10.76 |
EPS(TTM)2.03
EY8.1%
EPS(NY)2.26
Fwd EY9.04%
FCF(TTM)1.9
FCFY7.56%
OCF(TTM)1.98
OCFY7.91%
SpS10.98
BVpS20.35
TBVpS1.4
PEG (NY)16.17
PEG (5Y)1.28
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | -28.94% | ||
| ROE | -41.07% | ||
| ROCE | 2.47% | ||
| ROIC | 2.15% | ||
| ROICexc | 2.89% | ||
| ROICexgc | N/A | ||
| OM | 5.41% | ||
| PM (TTM) | N/A | ||
| GM | 77.08% | ||
| FCFM | 17.27% |
ROA(3y)-0.82%
ROA(5y)-0.38%
ROE(3y)-1.04%
ROE(5y)-0.46%
ROIC(3y)2.33%
ROIC(5y)1.77%
ROICexc(3y)2.95%
ROICexc(5y)2.21%
ROICexgc(3y)N/A
ROICexgc(5y)N/A
ROCE(3y)2.68%
ROCE(5y)2.04%
ROICexcg growth 3YN/A
ROICexcg growth 5YN/A
ROICexc growth 3Y29.17%
ROICexc growth 5YN/A
OM growth 3Y19.68%
OM growth 5YN/A
PM growth 3YN/A
PM growth 5YN/A
GM growth 3Y1.84%
GM growth 5Y1.44%
F-Score6
Asset Turnover0.38
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.05 | ||
| Debt/FCF | 0.55 | ||
| Debt/EBITDA | 0.67 | ||
| Cap/Depr | 9.09% | ||
| Cap/Sales | 0.8% | ||
| Interest Coverage | 7.19 | ||
| Cash Conversion | 127.35% | ||
| Profit Quality | N/A | ||
| Current Ratio | 1.68 | ||
| Quick Ratio | 1.63 | ||
| Altman-Z | 2.08 |
F-Score6
WACC9.5%
ROIC/WACC0.23
Cap/Depr(3y)10.55%
Cap/Depr(5y)12.88%
Cap/Sales(3y)1.05%
Cap/Sales(5y)1.47%
Profit Quality(3y)N/A
Profit Quality(5y)N/A
High Growth Momentum
Growth
EPS 1Y (TTM)-11.74%
EPS 3Y8.97%
EPS 5Y9.62%
EPS Q2Q%-22.95%
EPS Next Y0.76%
EPS Next 2Y1.45%
EPS Next 3Y1.19%
EPS Next 5YN/A
Revenue 1Y (TTM)-11.1%
Revenue growth 3Y-0.07%
Revenue growth 5Y-1.83%
Sales Q2Q%-2.89%
Revenue Next Year-3.53%
Revenue Next 2Y-0.64%
Revenue Next 3Y0.04%
Revenue Next 5Y2.44%
EBIT growth 1Y-48.89%
EBIT growth 3Y19.59%
EBIT growth 5YN/A
EBIT Next Year-5.09%
EBIT Next 3Y-1.48%
EBIT Next 5Y3.28%
FCF growth 1Y-42.11%
FCF growth 3Y-35.7%
FCF growth 5Y-16.11%
OCF growth 1Y-42.26%
OCF growth 3Y-34.97%
OCF growth 5Y-17.06%