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NetApp, Inc. (NTAP), situated in San Jose, California, is a global leader in data management and cloud storage solutions, serving enterprises with hybrid and multi-cloud environments. The company, with a market cap of $25 billion, provides data storage hardware, software, and services designed to help businesses optimize their digital transformation efforts.
Shares of NetApp have exceeded the broader market considerably over the past year, gaining 33.1%, while the broader S&P 500 Index ($SPX) has rallied 20.7%. Yet, in 2025, NTAP stock is up 3%, slightly lagging behind the SPX’s 3.1% rise on a YTD basis.
Zooming in further, NTAP’s outperformance is also apparent compared to the Technology Select Sector SPDR Fund (XLK). The exchange-traded fund has gained 13.7% over the past year and 1.6% this year.
NetApp has outpaced the broader market over the past year, driven by strong financial performance, robust demand for cloud services, and strategic product innovation. Additionally, NetApp’s AI-optimized storage solutions, such as the AIPod, positioned it well for enterprise AI adoption.
On Nov. 21, NetApp reported its Q2 fiscal 2025 earnings, posting $1.7 billion in revenue, up 6% year-over-year, and adjusted EPS of $1.87, beating analysts' estimates of $1.78. Strong growth in all-flash storage and a 43% surge in cloud storage revenue fueled this performance. Following the report, NTAP climbed over 2%, reflecting investor confidence. The company also raised its full-year earnings outlook, further strengthening market sentiment.
For the current fiscal year, ending in April 2025, analysts expect NTAP’s EPS to grow 16.4% to $5.89 on a diluted basis. The company’s earnings surprise history is mixed. It beat the consensus estimate in three of the last four quarters while missing the forecast on another occasion.
Among the 19 analysts covering NTAP stock, the consensus is a “Moderate Buy.” That’s based on five “Strong Buy” ratings, 13 “Holds,” and one “Moderate Sell.”
This configuration is less bullish than a month ago, with seven analysts suggesting a “Strong Buy.”
On Feb. 10, Susquehanna Community Financial, Inc. (SQCF) downgraded NetApp to “Neutral” from “Positive,” lowering the price target to $130 from $155. The firm cites growing downside risks to consensus estimates, particularly for the July and October quarters, due to tougher year-over-year comparisons. While NetApp has a robust market momentum, Susquehanna believes its valuation already reflects these gains. Additionally, enterprise AI is not expected to drive incremental demand until 2026.
The mean price target of $140.20 represents a 17.3% premium to NTAP’s current price levels. The Street-high price target of $160 suggests an upside potential of 33.8%.
