NetScout Systems (NASDAQ: NTCT) is one of 195 publicly-traded companies in the “IT Services & Consulting” industry, but how does it contrast to its peers? We will compare NetScout Systems to similar businesses based on the strength of its dividends, risk, valuation, institutional ownership, profitability, analyst recommendations and earnings.

Volatility & Risk

NetScout Systems has a beta of 1.6, suggesting that its stock price is 60% more volatile than the S&P 500. Comparatively, NetScout Systems’ peers have a beta of 1.27, suggesting that their average stock price is 27% more volatile than the S&P 500.

Profitability

This table compares NetScout Systems and its peers’ net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
NetScout Systems 1.52% 5.15% 3.49%
NetScout Systems Competitors -19.93% -51.29% -3.67%

Earnings and Valuation

This table compares NetScout Systems and its peers gross revenue, earnings per share and valuation.

Gross Revenue EBITDA Price/Earnings Ratio
NetScout Systems $1.12 billion $201.03 million 165.45
NetScout Systems Competitors $2.12 billion $374.80 million 36.29

NetScout Systems’ peers have higher revenue and earnings than NetScout Systems. NetScout Systems is trading at a higher price-to-earnings ratio than its peers, indicating that it is currently more expensive than other companies in its industry.

Institutional & Insider Ownership

62.4% of shares of all “IT Services & Consulting” companies are owned by institutional investors. 3.5% of NetScout Systems shares are owned by insiders. Comparatively, 16.4% of shares of all “IT Services & Consulting” companies are owned by insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a stock is poised for long-term growth.

Analyst Ratings

This is a breakdown of current ratings for NetScout Systems and its peers, as provided by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
NetScout Systems 0 3 1 0 2.25
NetScout Systems Competitors 677 4373 7106 154 2.55

NetScout Systems currently has a consensus price target of $32.33, suggesting a potential upside of 14.96%. As a group, “IT Services & Consulting” companies have a potential downside of 1.57%. Given NetScout Systems’ higher possible upside, research analysts plainly believe NetScout Systems is more favorable than its peers.

Summary

NetScout Systems peers beat NetScout Systems on 8 of the 13 factors compared.

About NetScout Systems

NetScout Systems, Inc. (NetScout) provides operational intelligence and performance analytics for service assurance and cyber security solutions. The Company’s solutions are used in various service provider, enterprise and government networks. Its nGenius and Infinistream technologies, along with certain product lines from the acquired businesses, enable information technology (IT) organizations to manage service delivery quality, and identify and address business service performance issues and security threats. The Company’s manufacturing operations consist of final product assembly, configuration and testing. The Company’s nGeniusONE Service Assurance Solution is used to support NetScout’s enterprise, service provider and government customers. The Company’s Intelligent Data Sources, marketed under the Infinistream brand, provide collection and analysis of high-volume packet-flow data from across the network that is displayed through the nGeniusONE Service Assurance Solution.

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