Fact based stock research
NETGEAR (NasdaqGS:NTGR)
US64111Q1040
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.
NETGEAR stock research in summary
ANALYSIS: With an Obermatt Combined Rank of 11 (worse than 89% compared with investment alternatives), NETGEAR (Communications Equipment, USA) shares have lower financial characteristics compared with similar stocks. Shares of NETGEAR are low in value (priced high) with a consolidated Value Rank of 39 (worse than 61% of alternatives), show below-average growth (Growth Rank of 31), and are riskily financed (Safety Rank of 43), which means above-average debt burdens. ...read more
RECOMMENDATION: A Combined Rank of 11, is a sell recommendation based on NETGEAR's financial characteristics. As the company NETGEAR's key financial metrics all exhibit below-average performance, such as low value (Obermatt Value Rank of 39), low growth (Obermatt Growth Rank of 31), and risky financing practices (Obermatt Safety Rank of 43), it is a somewhat questionable stock investment, where the risk of paying too much for the shares is significant, unless the company has an exceptionally bright future. Such poor financial performance sometimes indicates that the company's business is all concentrated in some distant future. This is sometimes the case for high-tech or biotechnology companies. If they own properties that only provide cash flows in the future, the stock may look excessively expensive and risky today. In such cases, the Obermatt Method has limited value as it is based on facts we can observe today. If the facts are all in the future, stock investing becomes guesswork, and this should only be a driver in a limited number of investments that should only amount to a small fraction of a safe portfolio. Obermatt Premium subscribers can further check the stock’s Sentiment Ranks, which also flow into the Obermatt 360° View for investors. ...read more
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Country | USA |
Industry | Communications Equipment |
Index | NASDAQ |
Size class | Large |
21-Mar-2024. Stock data may be delayed. Log in or sign up to get the most recent research.
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Review the performance ranks of the individual metrics that form each investment strategy.
Research History: NETGEAR
RESEARCH HISTORY | 2021 | 2022 | 2023 | 2024 | ||||
---|---|---|---|---|---|---|---|---|
VALUE | ||||||||
VALUE | 87 |
|
69 |
|
39 |
|
39 |
|
GROWTH | ||||||||
GROWTH | 76 |
|
3 |
|
65 |
|
31 |
|
SAFETY | ||||||||
SAFETY | 97 |
|
43 |
|
43 |
|
43 |
|
SENTIMENT | ||||||||
SENTIMENT | n/a |
|
25 |
|
55 |
|
new | |
360° VIEW | ||||||||
360° VIEW | n/a |
|
9 |
|
28 |
|
new |
Combined financial peformance in Detail
ANALYSIS: With an Obermatt Combined Rank of 11 (worse than 89% compared with investment alternatives), NETGEAR (Communications Equipment, USA) shares have lower financial characteristics compared with similar stocks. Shares of NETGEAR are low in value (priced high) with a consolidated Value Rank of 39 (worse than 61% of alternatives), show below-average growth (Growth Rank of 31), and are riskily financed (Safety Rank of 43), which means above-average debt burdens. ...read more
RECOMMENDATION: A Combined Rank of 11, is a sell recommendation based on NETGEAR's financial characteristics. As the company NETGEAR's key financial metrics all exhibit below-average performance, such as low value (Obermatt Value Rank of 39), low growth (Obermatt Growth Rank of 31), and risky financing practices (Obermatt Safety Rank of 43), it is a somewhat questionable stock investment, where the risk of paying too much for the shares is significant, unless the company has an exceptionally bright future. Such poor financial performance sometimes indicates that the company's business is all concentrated in some distant future. This is sometimes the case for high-tech or biotechnology companies. If they own properties that only provide cash flows in the future, the stock may look excessively expensive and risky today. In such cases, the Obermatt Method has limited value as it is based on facts we can observe today. If the facts are all in the future, stock investing becomes guesswork, and this should only be a driver in a limited number of investments that should only amount to a small fraction of a safe portfolio. Obermatt Premium subscribers can further check the stock’s Sentiment Ranks, which also flow into the Obermatt 360° View for investors. ...read more
RESEARCH HISTORY | 2021 | 2022 | 2023 | 2024 | ||||
---|---|---|---|---|---|---|---|---|
VALUE | ||||||||
VALUE | 87 |
|
69 |
|
39 |
|
39 |
|
GROWTH | ||||||||
GROWTH | 76 |
|
3 |
|
65 |
|
31 |
|
SAFETY | ||||||||
SAFETY | 97 |
|
43 |
|
43 |
|
43 |
|
COMBINED | ||||||||
COMBINED | 100 |
|
11 |
|
11 |
|
11 |
|
Value Metrics in Detail
ANALYSIS: With an Obermatt Value Rank of 39 (worse than 61% compared with alternatives), NETGEAR shares are more expensive than the average comparable stock. The Value Rank is based on consolidating four value indicators, where half the indicators are below and half above average for NETGEAR. Price-to-Sales (P/S) is 69, which means that the stock price compared with what market professionals expect for future sales is lower than for 69% of comparable companies, indicating a good value concerning NETGEAR's revenue size. The same is valid for the Price-to-Book Capital ratio (also referred to as market-to-book ratio), which is more favorable than for 74% of alternatives (26% of peers have a higher ratio). But expected dividend yields with a Dividend Yield rank of 1 are lower than average (dividends are expected to be lower than 99% of other stocks) while the Price to Profit ratio (or Price to Earnings (P/E) ratio) is higher than average with a Price-to-Profit Rank of 19, making the stock more expensive compared with the company's expected profit levels. ...read more
RECOMMENDATION: The overall picture with a consolidated Value Rank of 39, is a hold recommendation based on NETGEAR's stock price compared with the company's operational size and dividend yields. Low profits and low dividends as seen here for NETGEAR may indicate a restructuring phase. This could be transitory, making the company a good value when profits recover and dividends return to higher levels. If the stock price is compared with the size indicators for revenue and invested capital, it is on the lower side, making this stock a good value investment (apart from current profit and dividend expectations). We recommend further analyzing the stock with Obermatt’s Value, Safety, and Sentiment Ranks, including the 360° View, before making an investment decision. ...read more
VALUE METRICS | 2021 | 2022 | 2023 | 2024 | ||||
---|---|---|---|---|---|---|---|---|
PRICE VS. REVENUES (P/S) | ||||||||
PRICE VS. REVENUES (P/S) | 97 |
|
87 |
|
74 |
|
69 |
|
PRICE VS. PROFITS (P/E) | ||||||||
PRICE VS. PROFITS (P/E) | 98 |
|
49 |
|
27 |
|
19 |
|
PRICE VS. CAPITAL (Market-to-Book) | ||||||||
PRICE VS. CAPITAL (Market-to-Book) | 81 |
|
91 |
|
75 |
|
74 |
|
DIVIDEND YIELD | ||||||||
DIVIDEND YIELD | 1 |
|
1 |
|
1 |
|
1 |
|
CONSOLIDATED RANK: VALUE | ||||||||
CONSOLIDATED RANK: VALUE | 87 |
|
69 |
|
39 |
|
39 |
|
Growth Metrics in Detail
ANALYSIS: With an Obermatt Growth Rank of 31 (better than 31% compared with alternatives), NETGEAR shows a below-average growth dynamic in its industry. There is limited momentum in this company. The Growth Rank is based on consolidating four value indicators, with three out of four metrics below average for NETGEAR. While Profit Growth has a good rank of 100, as professionals currently expect the company to grow its profits more than 100% of its competitors, all other growth indicators are below market averages. Sales Growth has a rank of 34, which means that currently professionals expect the company to grow less than 66% of its competitors, while Capital Growth has a rank of 1 and Stock Returns have been below market median, with a rank of 42 (58% of alternative investments were better). ...read more
RECOMMENDATION: The overall picture with a consolidated Growth Rank of 31, is a hold recommendation for growth and momentum investors. While revenue growth and capital growth are good growth momentum indicators, profit is less reliable, because profits may increase due to cost-cutting measures which typically indicate negative growth momentum. "You can save a dollar only once" is the saying about such situations. Growth Investors should look at company priorities closely if they are interested in growth, because the increase in profits is not usually an indicator of growth, and stock prices have been below market, too. While momentum is a popular investment factor, the value aspect might be the more important one, in the longer term. We recommend analyzing the stock with Obermatt’s Value, Safety, and Sentiment Ranks to arrive at a 360° View of the stock purchase case, especially since the growth performance is limited here. ...read more
GROWTH METRICS | 2021 | 2022 | 2023 | 2024 | ||||
---|---|---|---|---|---|---|---|---|
REVENUE GROWTH | ||||||||
REVENUE GROWTH | 50 |
|
1 |
|
33 |
|
34 |
|
PROFIT GROWTH | ||||||||
PROFIT GROWTH | 20 |
|
18 |
|
89 |
|
100 |
|
CAPITAL GROWTH | ||||||||
CAPITAL GROWTH | n/a |
|
13 |
|
83 |
|
1 |
|
STOCK RETURNS | ||||||||
STOCK RETURNS | 67 |
|
23 |
|
35 |
|
42 |
|
CONSOLIDATED RANK: GROWTH | ||||||||
CONSOLIDATED RANK: GROWTH | 76 |
|
3 |
|
65 |
|
31 |
|
Safety Metrics in Detail
ANALYSIS: With an Obermatt Safety Rank of 43 (better than 43% compared with alternatives), the company NETGEAR has financing practices on the riskier side, which means that their overall debt burden is above the industry average. This doesn't mean that the business of NETGEAR is also risky, it only means that the company is on the riskier side in respect to bankruptcy in case things turn sour, assuming that public reporting is correct. The Safety Rank is based on consolidating three financing indicators, where all three are above average for NETGEAR. Leverage is at 100, meaning the company has a below-average debt-to-equity ratio. It has less debt than 100% of its competitors. Refinancing is at a rank of 91, meaning that the portion of the debt about to be refinanced is below average. It has less debt in the refinancing stage than 91% of its competitors. Finally, Liquidity is also good at a rank of 73, which means that the company generates more profit to service its debt than 73% of its competitors. ...read more
RECOMMENDATION: With a consolidated Safety Rank of 43 (worse than 57% compared with alternatives), NETGEAR has a financing structure that is riskier 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. Investors may not have a debt issue with NETGEAR but they should also compare Obermatt’s Value, Growth, and Sentiment Ranks before making a decision. ...read more
SAFETY METRICS | 2021 | 2022 | 2023 | 2024 | ||||
---|---|---|---|---|---|---|---|---|
LEVERAGE | ||||||||
LEVERAGE | 92 |
|
100 |
|
100 |
|
100 |
|
REFINANCING | ||||||||
REFINANCING | 83 |
|
95 |
|
93 |
|
91 |
|
LIQUIDITY | ||||||||
LIQUIDITY | 68 |
|
73 |
|
73 |
|
73 |
|
CONSOLIDATED RANK: SAFETY | ||||||||
CONSOLIDATED RANK: SAFETY | 97 |
|
43 |
|
43 |
|
43 |
|
Sentiment Metrics in Detail
SENTIMENT | 2021 | 2022 | 2023 | 2024 | ||||
---|---|---|---|---|---|---|---|---|
ANALYST OPINIONS | ||||||||
ANALYST OPINIONS | n/a |
|
4 |
|
34 |
|
new | |
OPINIONS CHANGE | ||||||||
OPINIONS CHANGE | n/a |
|
50 |
|
50 |
|
new | |
PRO HOLDINGS | ||||||||
PRO HOLDINGS | n/a |
|
55 |
|
59 |
|
new | |
MARKET PULSE | ||||||||
MARKET PULSE | n/a |
|
54 |
|
50 |
|
new | |
CONSOLIDATED RANK: SENTIMENT | ||||||||
CONSOLIDATED RANK: SENTIMENT | n/a |
|
25 |
|
55 |
|
new |
Stock analysis by the purely fact based Obermatt Method for NETGEAR from March 21, 2024.
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