Shares of NetApp soared about 11% in the extended trading session on Wednesday after the company reported stronger-than-expected 1Q results and provided an upbeat revenue outlook for the current quarter.
NetApp’s (NTAP) 1Q revenues climbed 4.8% to $1.3 billion year-over-year and surpassed analysts’ expectations of $1.15 billion. Its adjusted EPS increased 12.3% to $0.73 year-on-year and beat Street estimates of $0.41.
The data management company’s 2Q revenues guidance range of $1.225-$1.375 billion was higher than analysts’ expectations of $1.23 billion. However, adjusted EPS projection of $0.66-$0.74 missed Street estimates of $0.76. (See NTAP stock analysis on TipRanks).
Following its earnings, Susquehanna analyst Mehdi Hosseini reiterated his Buy rating on the stock and a price target of $60 (42.1% upside potential). Hosseini said, “While we remain positive on the long-term outlook, we still believe there is work to be done, including continued progress in their opex reduction plan and continued M&A activity to bolster their hybrid cloud portfolio, all while awaiting a macroeconomic improvement to catalyze IT spend on digital transformation.”
Currently, NTAP has a Hold analyst consensus. With shares down over 32% year-to-date, the average price target of $47.55 now implies upside potential of about 12.7% to current levels.
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