NETSCOUT SYSTEMS INC (NTCT) Stock Fundamental Analysis
USA - NASDAQ:NTCT - US64115T1043 - Common Stock
27.42 USD
+0.42 (+1.56%)
27.42 USD
0 (0%)
Taking everything into account, NTCT scores 5 out of 10 in our fundamental rating. 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 has a bad growth rate and is valued cheaply. With these ratings, NTCT could be worth investigating further for value investing!.
1. Profitability
1.1 Basic Checks
NTCT had positive earnings in the past year.
NTCT had a positive operating cash flow in the past year.
The reported net income has been mixed in the past 5 years: NTCT reported negative net income in multiple years.
Each year in the past 5 years NTCT had a positive operating cash flow.
1.2 Ratios
NTCT's Return On Assets of 3.37% is fine compared to the rest of the industry. NTCT outperforms 66.67% of its industry peers.
With a decent Return On Equity value of 4.70%, NTCT is doing good in the industry, outperforming 60.42% of the companies in the same industry.
With a decent Return On Invested Capital value of 4.18%, NTCT is doing good in the industry, outperforming 64.58% of the companies in the same industry.
NTCT had an Average Return On Invested Capital over the past 3 years of 2.83%. This is significantly below the industry average of 12.74%.
The last Return On Invested Capital (4.18%) for NTCT is above the 3 year average (2.83%), which is a sign of increasing profitability.
| 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
Looking at the Profit Margin, with a value of 8.72%, NTCT is in the better half of the industry, outperforming 79.17% 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.
NTCT has a Gross Margin of 78.70%. This is amongst the best in the industry. NTCT outperforms 97.92% of its industry peers.
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
NTCT has a Return on Invested Capital (ROIC), which is below the Cost of Capital (WACC), which means it is destroying value.
NTCT has more shares outstanding than it did 1 year ago.
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 2.60. 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.
Looking at the Altman-Z score, with a value of 2.60, NTCT is in the better half of the industry, outperforming 66.67% of the companies in the same industry.
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.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0 | ||
| Debt/FCF | 0 | ||
| Altman-Z | 2.6 |
ROIC/WACC0.45
WACC9.26%
2.3 Liquidity
A Current Ratio of 1.77 indicates that NTCT should not have too much problems paying its short term obligations.
The Current ratio of NTCT (1.77) is worse than 62.50% of its industry peers.
NTCT has a Quick Ratio of 1.73. 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 Quick ratio, with a value of 1.73, NTCT is in line with its industry, outperforming 58.33% 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 grown by an nice 19.21% over the past year.
Measured over the past 5 years, NTCT shows a small growth in Earnings Per Share. The EPS has been growing by 6.94% on average per year.
The Revenue has decreased by -0.82% in the past year.
The Revenue has been decreasing by -1.60% on average over the past years.
EPS 1Y (TTM)19.21%
EPS 3Y6.11%
EPS 5Y6.94%
EPS Q2Q%31.91%
Revenue 1Y (TTM)-0.82%
Revenue growth 3Y-1.3%
Revenue growth 5Y-1.6%
Sales Q2Q%14.6%
3.2 Future
NTCT is expected to show a small growth in Earnings Per Share. In the coming years, the EPS will grow by 5.12% yearly.
NTCT is expected to show a small growth in Revenue. In the coming years, the Revenue will grow by 3.60% yearly.
EPS Next Y7.77%
EPS Next 2Y6.01%
EPS Next 3Y5.12%
EPS Next 5YN/A
Revenue Next Year4.21%
Revenue Next 2Y3.44%
Revenue Next 3Y3.6%
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 decreasing.
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
The Price/Earnings ratio is 11.33, which indicates a very decent valuation of NTCT.
Based on the Price/Earnings ratio, NTCT is valued cheaply inside the industry as 89.58% of the companies are valued more expensively.
The average S&P500 Price/Earnings ratio is at 25.89. NTCT is valued rather cheaply when compared to this.
A Price/Forward Earnings ratio of 11.04 indicates a reasonable valuation of NTCT.
Compared to the rest of the industry, the Price/Forward Earnings ratio of NTCT indicates a rather cheap valuation: NTCT is cheaper than 93.75% of the companies listed in the same industry.
NTCT is valuated cheaply when we compare the Price/Forward Earnings ratio to 34.59, which is the current average of the S&P500 Index.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 11.33 | ||
| Fwd PE | 11.04 |
4.2 Price Multiples
Based on the Enterprise Value to EBITDA ratio, NTCT is valued cheaper than 81.25% of the companies in the same industry.
Compared to the rest of the industry, the Price/Free Cash Flow ratio of NTCT indicates a rather cheap valuation: NTCT is cheaper than 97.92% of the companies listed in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 8.03 | ||
| EV/EBITDA | 8.98 |
4.3 Compensation for Growth
NTCT's PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates a correct valuation of the company.
NTCT has a very decent profitability rating, which may justify a higher PE ratio.
PEG (NY)1.46
PEG (5Y)1.63
EPS Next 2Y6.01%
EPS Next 3Y5.12%
5. Dividend
5.1 Amount
No dividends for NTCT!.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | N/A |
27.42
+0.42 (+1.56%)
Chartmill FA Rating
GICS SectorInformation Technology
GICS IndustryGroupTechnology Hardware & Equipment
GICS IndustryCommunications Equipment
Earnings (Last)
Earnings (Next)
Inst Owners92.46%
Inst Owner Change8.87%
Ins Owners3.72%
Ins Owner Change6.84%
Market Cap1.97B
Revenue(TTM)822.68M
Net Income(TTM)72.78M
Analysts76
Price Target31.69 (15.57%)
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)3.17%
PT rev (3m)6.58%
EPS NQ rev (1m)0%
EPS NQ rev (3m)-8.59%
EPS NY rev (1m)0.86%
EPS NY rev (3m)2.56%
Revenue NQ rev (1m)0%
Revenue NQ rev (3m)0.72%
Revenue NY rev (1m)0.25%
Revenue NY rev (3m)1.35%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 11.33 | ||
| Fwd PE | 11.04 | ||
| P/S | 2.36 | ||
| P/FCF | 8.03 | ||
| P/OCF | 7.8 | ||
| P/B | 1.27 | ||
| P/tB | 8.66 | ||
| EV/EBITDA | 8.98 |
EPS(TTM)2.42
EY8.83%
EPS(NY)2.48
Fwd EY9.06%
FCF(TTM)3.42
FCFY12.46%
OCF(TTM)3.52
OCFY12.83%
SpS11.61
BVpS21.53
TBVpS3.16
PEG (NY)1.46
PEG (5Y)1.63
Graham Number34.24
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 | 2.6 |
F-Score9
WACC9.26%
ROIC/WACC0.45
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)19.21%
EPS 3Y6.11%
EPS 5Y6.94%
EPS Q2Q%31.91%
EPS Next Y7.77%
EPS Next 2Y6.01%
EPS Next 3Y5.12%
EPS Next 5YN/A
Revenue 1Y (TTM)-0.82%
Revenue growth 3Y-1.3%
Revenue growth 5Y-1.6%
Sales Q2Q%14.6%
Revenue Next Year4.21%
Revenue Next 2Y3.44%
Revenue Next 3Y3.6%
Revenue Next 5YN/A
EBIT growth 1Y92.87%
EBIT growth 3Y18.01%
EBIT growth 5Y31.51%
EBIT Next Year3.21%
EBIT Next 3Y4.75%
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 8 / 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 11.33 and the Price/Book (PB) ratio is 1.27.
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.