September 19, 2024
Top 10 Stock NetScout Buy Recommendation
How to read the ranks
For every stock, we judge its performance against its peers and rank it on a scale of 1 to 100. The higher the rank, the better the stock performs than its peers. And, we do this for six investment strategies:
Value - shows how good of a value the stock is. Green is "inexpensive"; red is "expensive".
Growth - shows a company's growth potential. Green is "high growth" expected; red is "tough times ahead".
Safety - relates to the amount of debt a company has. Green is low debt level; red is high debt level.
Combined Financial - this isn't an average of the first three ranks but rather a consolidated view across several financial indicators. Green = good; red = tread carefully.
(NEW) Sentiment - quantifies professional analyst ratings and holdings as well as market pulse. Green = positive sentiment; red = skepticism (Only available to Premium Subscribers).
(NEW) 360° View - the ultimate rating with all financial and non-financial indicators.
Snapshot: NetScout – Top 10 Stock in S&P Mid-Cap Index
NetScout is listed as a top 10 stock on September 19, 2024 in the market index S&P MIDCAP because of its high performance in at least one of the Obermatt investment strategies. While half the consolidated Obermatt Ranks are above-average, investor sentiment is negative and growth performance is below market average, both a sign for caution. Based on the Obermatt 360° View of 61 (high 61% performer), Obermatt assesses an overall buy recommendation for NetScout on September 19, 2024.
Snapshot: Obermatt Ranks
| Country | USA |
| Industry | Communications Equipment |
| Index | Human Rights, Sound Pay USA, NASDAQ, S&P MIDCAP |
| Size class | Large |
When Obermatt identifies the Top 10 stocks in a market, it’s based on a certain investment strategy. The best performing stocks usually aren’t the ones that everyone is talking about (those are often "over-priced" and have low Value ranks).
For each investment strategy, we provide you with more detailed analysis and our recommendation. You see the ranks of the top 10 stocks ranked by that particular investment strategy (360° View, Sentiment, Value, Growth, Safety and Combined Financial Performance).
360° View: Obermatt 360° View NetScout Buy
| 360 METRICS | September 19, 2024 | |||||||
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| VALUE | ||||||||
| VALUE | 91 |
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| GROWTH | ||||||||
| GROWTH | 6 |
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| SAFETY | ||||||||
| SAFETY | 100 |
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| SENTIMENT | ||||||||
| SENTIMENT | 3 |
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| 360° VIEW | ||||||||
| 360° VIEW | 61 |
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ANALYSIS: With an Obermatt 360° View of 61 (better than 61% compared with alternatives), overall professional sentiment and financial characteristics for the stock NetScout are above average. The 360° View is based on consolidating four consolidated indicators, with half the metrics below and half above average for NetScout. The consolidated Value Rank has an attractive rank of 91, which means that the share price of NetScout is on the lower side compared with the typical size in indicators such as revenues, profits, and invested capital. This means the stock price is lower than for 91% of alternative stocks in the same industry. The company is also safely financed with a Safety rank of 100. But the professional market sentiment is below average compared with other stock investment alternatives with a Sentiment Rank of 3. Professional investors are more confident in 97% other stocks. The consolidated Growth Rank also has a low rank of 6, which means that the company is below average in terms of growth momentum when looking at financial metrics such as revenue, profit, invested capital growth, and stock returns. 94 of its competitors have better growth. ...read more
RECOMMENDATION: With a consolidated 360° View of 61, NetScout is better positioned than 61% of all alternative stock investment opportunities based on the Obermatt Method. The picture is mixed here. The stock seems to be a good value (Value Rank of 91), and the financing structure is on the safer side (Safety Rank of 100). However, sentiment in the professional investor community is below-average (Sentiment Rank of 3), as is the growth momentum for the company (Growth Rank of 6). Since the company is good value and the share price low, it should attract investors, yet professionals are skeptical. Even though the financing structure is not as important as Value, Growth, and Sentiment, investors should still be careful with this decision and conduct further research if they are serious about investing in this company. ...read more
Sentiment Strategy: Professional Market Sentiment for NetScout negative
ANALYSIS: With an Obermatt Sentiment Rank of 3 (better than 3% compared with alternatives), overall professional sentiment and engagement for the stock NetScout is critical, mostly below average. The Sentiment Rank is based on consolidating four sentiment indicators, with three out of four metrics below average for NetScout. Analyst Opinions are at a rank of 1 (worse than 99% of alternative investments), which means that currently, stock research analysts tend to warn against investing in the stock of the company. But they are changing their opinions! Analyst Opinions Change has a rank of 50, which means that stock research experts have found something to make them more positive about investing in the company. In other words, they are getting more optimistic of stock investments in NetScout. But the Professional Investors rank is low at 19, which means that professional investors hold less stock in this company than in 81% of alternative investment opportunities. Pros tend to invest in other companies. Market Pulse is also low at a rank of 8, which means that the current professional news and professional social networks tend to be negative when discussing this company (more negative news than for 92% of competitors). ...read more
RECOMMENDATION: With a consolidated Sentiment Rank of 3 (less encouraging than 97% compared with investment alternatives), NetScout has a reputation among professional investors that is far below that of its competitors. These are quite a few negative sentiment signals. One may want to trust the analysts that are changing their opinions. They may be early indications of better times, especially if the company is a smaller one. But If they are an extra large company, they should have more professional stockholders than are currently present. ...read more
Value Strategy: NetScout Stock Price Value at the top
ANALYSIS: With an Obermatt Value Rank of 91 (better than 91% compared with alternatives) for 2024, NetScout shares are significantly less expensive than comparable stocks. The Value Rank is based on consolidating four value indicators, with three out of four indicators above average for NetScout. Price-to-Sales (P/S) is 75, which means that the stock price compared with what market professionals expect for future sales is lower than for 75% of comparable companies, indicating a good value regarding NetScout's revenue size. The same is valid for expected Price to Profits (or Price / Earnings, P/E), more favorable than for 97% of alternatives, and it's also true for the Price-to-Book Capital ratio (also referred to as market-to-book ratio) with a Price-to-Capital Rank of 90. But, compared with other companies in the same industry, dividend yields are expected to be lower than average; only 1% of all competitors have even lower dividend yields than NetScout (a Dividend Yield Rank of 1). 99% alternative investments in the same business provide a higher dividend yield. ...read more
RECOMMENDATION: The overall picture with a consolidated Value Rank of 91, is a buy recommendation based on NetScout's stock price compared with the company's operational size and dividend yields. The below-average dividend yield may be a good sign, as it could mean the company has more attractive investment opportunities for the generated cash than to pay it out as dividends. A low dividend yield can also indicate a growth phase. ...read more
Growth Strategy: NetScout Growth Momentum negative
ANALYSIS: With an Obermatt Growth Rank of 6 (better than 6% compared with alternatives), NetScout shows one of the most restricted growth dynamics in its industry. There is little momentum in this company. The Growth Rank is based on consolidating four value indicators, with all four metrics below average for NetScout. Sales Growth has a rank of 6, which means that currently professionals expect the company to grow less than 94% of its competitors. The same is valid for Profit Growth, with a rank of 22, and Capital Growth with 25. In addition, Stock Returns have a below market rank of 23, which means that the stock returns have recently been below 77% of alternative investments. ...read more
RECOMMENDATION: The overall picture with a consolidated Growth Rank of 6, is a sell recommendation for growth and momentum investors. These are all bad growth momentum indicators. These are negative signals for investors interested in growth companies. Value is likely good for this company, as investors may have left this stock in the cold. If that is the case, investors should look at the company's outlook, especially Sentiment performance, because it may be a turnaround situation that could entail above-average stock returns in the future. But it remains a risky bet, as no growth signals are in the green zone yet. ...read more
Safety Strategy: NetScout Debt Financing Safety very solid
| SAFETY METRICS | September 19, 2024 | |||||||
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| LEVERAGE | ||||||||
| LEVERAGE | 74 |
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| REFINANCING | ||||||||
| REFINANCING | 61 |
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| LIQUIDITY | ||||||||
| LIQUIDITY | 87 |
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| CONSOLIDATED RANK: SAFETY | ||||||||
| CONSOLIDATED RANK: SAFETY | 100 |
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ANALYSIS: With an Obermatt Safety Rank of 100 (better than 100% compared with alternatives) for 2024, the company NetScout has safe financing practices, which means that their overall debt burden is low. This doesn't mean that the business of NetScout is safe, it only means that the company is on the safer side regarding possible bankruptcy, assuming that public reporting is correct. The Safety Rank is based on consolidating three financing indicators, where all three are above average for NetScout. Leverage is at 74, meaning the company has a below-average debt-to-equity ratio. It has less debt than 74% of its competitors. Refinancing is at a rank of 61, meaning that the portion of the debt about to be refinanced is below average. It has less debt in the refinancing stage than 61% of its competitors. Finally, Liquidity is also good at a rank of 87, which means that the company generates more profit to service its debt than 87% of its competitors. ...read more
RECOMMENDATION: With a consolidated Safety Rank of 100 (better than 100% compared with alternatives), NetScout has a financing structure that is significantly safer than that of its competitors. These three positive financing indicators signal that the company is less likely to default on its debt obligations. However, it also means that its shareholder returns will be more modest if things go well. A low safety means fewer troubles in downtimes and less upside in good times. ...read more
Combined financial peformance: NetScout Top Financial Performance
| COMBINED PERFORMANCE | September 19, 2024 | |||||||
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| VALUE | ||||||||
| VALUE | 91 |
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| GROWTH | ||||||||
| GROWTH | 6 |
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| SAFETY | ||||||||
| SAFETY | 87 |
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| COMBINED | ||||||||
| COMBINED | 90 |
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ANALYSIS: With an Obermatt Combined Rank of 90 (better than 90% compared with investment alternatives), NetScout (Communications Equipment, USA) shares have much better financial characteristics than comparable stocks. Shares of NetScout are a good value (attractively priced) with a consolidated Value Rank of 91 (better than 91% of alternatives), are safely financed (Safety Rank of 100, which means low debt burdens), but show below-average growth (Growth Rank of 6). ...read more
RECOMMENDATION: A Combined Rank of 90, is a strong buy recommendation based on NetScout's financial characteristics. As the company NetScout's key financial metrics exhibit good value (Obermatt Value Rank of 91) but low growth (Obermatt Growth Rank of 6) while being safely financed (Obermatt Safety Rank of 100), it may be a safer investment because companies with low debt can better withstand times of crises. Yet the good value, better than 91% of comparable companies, may also indicate that the company's future is challenging. If you believe that low growth is temporary or just due to a specific current event, you may conclude that the good value of the stock provides an attractive investment opportunity and the downside is limited due to below-average financing risks. ...read more
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