NetApp, Inc. to Issue Quarterly Dividend of $0.52 (NASDAQ:NTAP)

Key Points

• NetApp will pay a quarterly dividend of $0.52 per share on October 28 to shareholders of record on October 9, implying an annualized yield of approximately 1.2%.
• The dividend appears well covered, with a payout ratio of 24.6%; analysts expect next year’s earnings to support a projected payout ratio of about 25.3%.
• NetApp recently exceeded quarterly earnings and revenue expectations, but shares traded lower amid concerns about declining gross margins and weaker free cash flow.

NetApp, Inc. (NASDAQ:NTAP - Get Free Report) announced a quarterly dividend on Wednesday, September 2nd. Shareholders of record on Friday, October 9th will be paid a dividend of 0.52 per share by the data storage provider on Wednesday, October 28th. This represents a c) dividend on an annualized basis and a dividend yield of 1.2%. The ex-dividend date of this dividend is Friday, October 9th.

NetApp has raised its dividend by an average of 0.0%annually over the last three years and has raised its dividend every year for the last 1 years. NetApp has a dividend payout ratio of 24.6% meaning its dividend is sufficiently covered by earnings. Analysts expect NetApp to earn $8.21 per share next year, which means the company should continue to be able to cover its $2.08 annual dividend with an expected future payout ratio of 25.3%.

NetApp Trading Down 1.3%

Shares of NASDAQ:NTAP opened at $180.77 on Thursday. NetApp has a 52 week low of $93.69 and a 52 week high of $209.06. The company's 50 day moving average is $177.45 and its two-hundred day moving average is $139.96. The company has a market cap of $35.47 billion, a PE ratio of 28.42, a P/E/G ratio of 2.49 and a beta of 1.44. The company has a current ratio of 1.44, a quick ratio of 1.39 and a debt-to-equity ratio of 1.84.

NetApp (NASDAQ:NTAP - Get Free Report) last released its quarterly earnings data on Wednesday, September 2nd. The data storage provider reported $2.58 earnings per share (EPS) for the quarter, topping the consensus estimate of $2.12 by $0.46. The business had revenue of $2.02 billion during the quarter, compared to analysts' expectations of $1.84 billion. NetApp had a net margin of 18.43% and a return on equity of 117.23%. The company's revenue for the quarter was up 29.9% on a year-over-year basis. During the same period in the previous year, the company earned $1.15 EPS. NetApp has set its FY 2027 guidance at 9.730-10.030 EPS and its Q2 2027 guidance at 2.540-2.640 EPS. Equities analysts predict that NetApp will post 7.34 earnings per share for the current fiscal year.

Key NetApp News

Here are the key news stories impacting NetApp this week:

• Positive Sentiment: NetApp reported record fiscal Q1 revenue of approximately $2.03 billion, up nearly 30% year over year, while non-GAAP EPS of $2.58 exceeded the roughly $2.12 analyst consensus. All-flash array revenue increased 47% to $1.31 billion, supported by AI and hybrid-cloud demand. NetApp Stock Tanks Despite Strong Q1 Earnings Print
• Positive Sentiment: The company raised its fiscal 2027 outlook to approximately $8.0 billion-$8.2 billion in revenue and $9.73-$10.03 in non-GAAP EPS, well above consensus expectations. It also issued Q2 EPS guidance of $2.54-$2.64, ahead of estimates. NetApp Raises Guidance
• Positive Sentiment: NetApp announced new ONTAP capabilities validated for VMware Cloud Foundation 9.1 and disclosed the acquisition of AI data-infrastructure company DataPelago, potentially strengthening its position in AI workloads and private cloud. NetApp VMware Cloud Foundation Announcement
• Neutral Sentiment: NetApp maintained its quarterly dividend at $0.52 per share, payable October 28 to shareholders of record October 9, implying an annualized yield of about 1.2%.
• Negative Sentiment: Investors reacted negatively to management’s warning that second-quarter gross margin will decline. Non-GAAP gross margin was 70.6% in Q1, while product margins came under sequential pressure from higher component costs and a less favorable product mix. NetApp Warns Gross Margin Will Fall
• Negative Sentiment: Free cash flow fell to approximately $401 million, while operating cash flow was $503 million and inventory increased. The weaker cash conversion raised concerns about execution and valuation after a substantial prior run-up, prompting profit-taking despite the earnings and guidance beats. NetApp Free Cash Flow Decline

NetApp Company Profile

NetApp, Inc NASDAQ: NTAP is a data management and storage company that delivers hybrid cloud data services for applications and data. Founded in 1992 as Network Appliance and rebranded as NetApp in 2008, the company is headquartered in Sunnyvale, California. NetApp's offering focuses on enabling organizations to store, manage, protect and move data across on-premises environments and major public clouds.

The company's product portfolio centers on the ONTAP data management software and a range of storage systems and services built around it.

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