NetApp, Inc. (NTAP) Stock Valuation — PE Analysis
Computer Hardware · NASDAQ
Current Price
$173.23
PE Ratio (TTM)
26.9x
Intrinsic Value
$167.32
-3.5% margin of safety
COMPETITIVE MOAT
↑Enterprise Data Infrastructure Expertise
NetApp's deep experience in enterprise data management and storage solutions creates significant switching costs for its large customer base. This expertise is crucial for complex data environments.
↑Hybrid Cloud Data Management Leadership
The company's ability to manage data seamlessly across on-premises and multiple cloud environments offers a unique value proposition. This hybrid approach is essential for many enterprises.
↑AI Infrastructure Differentiation
NetApp provides a specialized entry into AI infrastructure, offering a distinct advantage by avoiding the inflated valuations of pure-play chip companies. This positions them well for emerging AI workloads.
INVESTMENT RISKS
↓Dependence on Enterprise IT Spending Cycles
NetApp's revenue is tied to the capital expenditure budgets of large enterprises. Economic downturns or shifts in IT spending priorities can significantly impact sales.
↓Competition from Software-Defined Storage
The rise of software-defined storage solutions offers greater flexibility and potentially lower costs, challenging NetApp's hardware-centric approach. This could erode market share.
↓Integration Challenges with New Technologies
Successfully integrating and optimizing their solutions for rapidly evolving AI platforms and new cloud services is critical. Any missteps could lead to customer dissatisfaction.
Base case
NTAP base case PE valuation
At a current price of $173.23, the base case PE valuation puts NTAP fair value near $167.32 per share. That figure assumes 5.1% yearly earnings growth, a target PE multiple of 27x, and a 10% discount rate.
Intrinsic Value
$167.32
Margin of safety
-3.5%
Expected annual return
-0.7%
Base case assumptions: 5.1% annual earnings growth, 27x target PE, 10% discount rate, 5 year projection. Data as of 2026-07-29.
This base case uses default assumptions and is not financial advice. The fair value changes significantly when the target PE or earnings growth rate changes. Open the calculator to set your own assumptions and see the full sensitivity range.
Customize the NTAP PE valuation
Adjust the target PE, earnings growth, and discount rate to see how the fair value and margin of safety for NetApp, Inc. respond.
Open PE Calculator for NTAPCompany Overview
NetApp, Inc. is a technology company focused on providing cloud-centric and data-driven services that enable businesses worldwide to efficiently manage and share their information across on-premises infrastructure, private cloud setups, and public cloud platforms. The company's operations are divided into two key segments: Hybrid Cloud and Public Cloud. NetApp offers an extensive suite of intelligent data management software, including its foundational NetApp ONTAP, NetApp Snapshot for data protection, NetApp SnapCenter for backup management, NetApp SnapMirror for data replication, NetApp SnapLock for data compliance, NetApp ElementOS software, and NetApp SANtricity software. Its storage infrastructure solutions comprise the NetApp All-Flash FAS series, NetApp Fabric Attached Storage, NetApp FlexPod integrated systems, NetApp E/EF series, NetApp StorageGRID object storage, and NetApp SolidFire solutions. For cloud environments, NetApp delivers a wide array of cloud storage and data services such as NetApp Cloud Volumes ONTAP, Azure NetApp Files, Amazon FSx for NetApp ONTAP, and NetApp Cloud Volumes Service for Google Cloud. These are augmented by services like NetApp Cloud Sync, NetApp Cloud Tiering, NetApp Cloud Backup, NetApp Cloud Data Sense for analytics, and NetApp Cloud Volumes Edge Cache. The company also provides cloud operations services, which include NetApp Cloud Insights, the Spot Ocean Kubernetes Suite, Spot Security, Spot Eco for cost optimization, and Spot CloudCheckr. Moreover, NetApp offers application-aware data management solutions under its NetApp Astra brand. Its service portfolio is rounded out by comprehensive professional and support services, encompassing strategic consulting, managed services, and dedicated support, in addition to assessment, design, implementation, and migration services. NetApp serves a broad spectrum of industries globally, including energy, financial services, government, technology, internet, life sciences, healthcare, manufacturing, media, entertainment, animation, video post-production, and telecommunications. The company reaches its clientele through a direct sales force and a robust network of partners. NetApp, Inc. was founded in 1992 and is headquartered in San Jose, California.
Financial Metrics — NTAP PE Stock Valuation Data
PE Ratio (TTM)
26.9x
PEG Ratio
2.52
Earnings Yield
3.74%
ROE (TTM)
114.2%
Revenue/Share (TTM)
$35.15
Dividend Yield
1.20%
Debt/Equity
2.02x
Frequently Asked Questions
What is the PE ratio of NTAP?
The trailing twelve-month PE ratio of NTAP reflects how much investors pay per dollar of NetApp, Inc.'s earnings. This metric is most useful when compared to Computer Hardware peers and the company's own historical range.
Is NTAP overvalued based on PE ratio?
NTAP's PE of 26.9x combined with a PEG ratio of 2.52 provides a growth-adjusted perspective. A PEG above 2.0 means the P/E is high relative to the earnings growth rate. Keep in mind that PE-based valuation works best for profitable, mature companies — for high-growth or cyclical Computer Hardware, a DCF analysis may be more appropriate.
How do I value NTAP stock using PE ratio?
To value NetApp, Inc. using PE: (1) Compare the current PE (26.9x) against the Computer Hardware median to assess relative pricing, (2) check the PEG ratio (2.52) to adjust for growth expectations, (3) review the 5-year PE range to identify where the stock sits historically, and (4) estimate fair value by multiplying a target PE by forward EPS estimates. This relative approach complements DCF's absolute valuation.
What is the PEG ratio of NTAP?
NTAP's PEG ratio is 2.52, calculated by dividing the PE ratio (26.9x) by the expected earnings growth rate. A PEG above 2.0 means the P/E is high relative to the expected earnings growth rate. Note that PEG accuracy depends on the reliability of growth estimates.
Should I use PE ratio or DCF for NTAP stock valuation?
PE ratio gives a quick relative read — how NTAP is priced versus Computer Hardware peers. DCF provides an absolute value based on projected free cash flows. For NTAP, with a strong ROE of 114.2%, both methods are worth using — PE for a market-relative check, DCF to stress-test whether fundamentals justify the price. Each method has blind spots: PE ignores capital structure and cash flow quality, while DCF is sensitive to growth and discount rate assumptions.
Learn More
- See NTAP DCF Valuation → — Intrinsic value via Discounted Cash Flow analysis
- PE Methodology — Step-by-step guide to PE ratio stock valuation
- DCF Methodology — Guide to discounted cash flow analysis
- PE Ratio — Understanding the price-to-earnings ratio
- Intrinsic Value — How to evaluate stock fair value
Related PE Valuations
All Technology valuationsP/E and DCF value NTAP with different methods and assumptions, so the two conclusions can differ. Compare the DCF intrinsic value.
Price as of 2026-07-29. Financial data from Financial Modeling Prep (trailing twelve months) · Valuation methodology by Charlie Wang.
This is an estimate, not investment advice.