Reviewing Nimble Storage (NMBL) & NetApp (NASDAQ:NTAP)

Nimble Storage (NYSE: NMBL) and NetApp (NASDAQ:NTAP) are both technology companies, but which is the better investment? We will compare the two businesses based on the strength of their valuation, risk, analyst recommendations, profitability, institutional ownership, dividends and earnings.

Profitability

This table compares Nimble Storage and NetApp’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Nimble Storage -31.11% -130.73% -44.52%
NetApp 10.47% 24.16% 7.31%

Dividends

NetApp pays an annual dividend of $0.80 per share and has a dividend yield of 2.0%. Nimble Storage does not pay a dividend. NetApp pays out 38.6% of its earnings in the form of a dividend.

Analyst Recommendations

This is a summary of current ratings for Nimble Storage and NetApp, as reported by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Nimble Storage 0 16 3 0 2.16
NetApp 3 17 11 0 2.26

Nimble Storage presently has a consensus target price of $12.65, suggesting a potential upside of 1.31%. NetApp has a consensus target price of $43.83, suggesting a potential upside of 11.39%. Given NetApp’s stronger consensus rating and higher possible upside, analysts clearly believe NetApp is more favorable than Nimble Storage.

Institutional & Insider Ownership

63.4% of Nimble Storage shares are held by institutional investors. Comparatively, 90.1% of NetApp shares are held by institutional investors. 20.9% of Nimble Storage shares are held by company insiders. Comparatively, 0.5% of NetApp shares are held by company insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a stock will outperform the market over the long term.

Volatility & Risk

Nimble Storage has a beta of 1.78, meaning that its share price is 78% more volatile than the S&P 500. Comparatively, NetApp has a beta of 1.21, meaning that its share price is 21% more volatile than the S&P 500.

Earnings & Valuation

This table compares Nimble Storage and NetApp’s gross revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio EBITDA Earnings Per Share Price/Earnings Ratio
Nimble Storage N/A N/A N/A ($1.83) -6.83
NetApp $5.55 billion 1.93 $950.00 million $2.07 19.01

NetApp has higher revenue and earnings than Nimble Storage. Nimble Storage is trading at a lower price-to-earnings ratio than NetApp, indicating that it is currently the more affordable of the two stocks.

Summary

NetApp beats Nimble Storage on 10 of the 13 factors compared between the two stocks.

About Nimble Storage

Nimble Storage, Inc. (Nimble Storage) focuses on providing its end-customers with data. The Company’s Predictive Cloud Platform combines predictive analytics, flash storage and multicloud infrastructure to manage operations in on-premises data centers and in the cloud. Its products allow end-customers to deploy workloads flexibly on flash arrays, converged infrastructure and the public cloud. Its operating system includes NimbleOS. NimbleOS runs across all of its All Flash and Adaptive Flash (Hybrid) arrays and powers Nimble Cloud Volumes. The features of NimbleOS include Cache Accelerated Sequential Layout (CASL), Variable Block Inline Deduplication, Variable Block Inline Compression, Efficient All Flash Array Architecture, Dynamic Caching for Adaptive Flash Arrays, Efficient, Instant Snapshots and Replication, SmartSecure Encryption and Data Shredding and Scalability.

About NetApp

NetApp, Inc. (NetApp) provides software, systems and services to manage and store customer data. The Company enables enterprises, service providers, governmental organizations, and partners to envision, deploy and evolve their information technology (IT) environments. The Company offers a portfolio of products and services that satisfy a range of customer workloads across different data types and deployment models. Its data management and storage offerings help manage business productivity, performance and profitability, while providing investment protection and asset utilization. The Company’s FlexPod portfolio includes FlexPod Datacenter for core enterprise data centers and service providers, FlexPod Express for medium-sized businesses and branch offices, and FlexPod Select for data-intensive workloads. The portfolio is validated with hypervisors, operating systems, systems management tools and cloud management platforms.

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