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Netgear (NTGR)
NASDAQ:NTGR
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Netgear
(NASDAQ:NTGR)
Rating:56Neutral
Price Target:
$28.00
▲(4.87%Upside)
Netgear (NTGR) vs. SPDR S&P 500 ETF (SPY)
Market Cap
$787.23M
Dividend YieldN/A
Average Volume (3M)458.80K
Price to Earnings (P/E)33.5
Beta (1Y)1.33
Revenue Growth-6.97%
EPS GrowthN/A
CountryUS
Employees636
SectorTechnology
Sector Strength81
IndustryCommunication Equipment
Share Statistics
EPS (TTM)0.02
Shares Outstanding28,783,594
10 Day Avg. Volume437,513
30 Day Avg. Volume458,800
Financial Highlights & Ratios
PEG Ratio0.03
Price to Book (P/B)0.85
Price to Sales (P/S)0.00
P/FCF Ratio-26.95
Enterprise Value/Market Cap0.54
Enterprise Value/Revenue0.16
Enterprise Value/Gross Profit2.08
Enterprise Value/Ebitda-1.81
Forecast
1Y Price Target
$29.00Price Target Upside8.61% Upside
Rating ConsensusModerate Buy
Number of Analyst Covering0
Netgear Business Overview & Revenue Model
Company DescriptionNetgear, Inc. (NTGR) is a global networking company that delivers innovative products to consumers, businesses, and service providers. The company operates primarily in three segments: Retail, Commercial, and Service Provider. Netgear's core products include networking hardware such as routers, switches, and Wi-Fi systems, along with smart home devices, security cameras, and NAS (Network Attached Storage) solutions. The company is known for its emphasis on reliability, performance, and ease of use, catering to a wide range of customers from individual home users to large enterprises.
How the Company Makes MoneyNetgear makes money through the sale of its networking products and services across its three primary segments: Retail, Commercial, and Service Provider. The Retail segment generates revenue from the sale of consumer-focused networking products such as Wi-Fi routers, mesh systems, and smart home devices. The Commercial segment targets small to medium-sized businesses, offering products like Ethernet switches, wireless access points, and NAS devices. The Service Provider segment earns revenue by supplying networking equipment to internet service providers who then offer these solutions to their end-users. Netgear also capitalizes on recurring revenue through subscriptions and services associated with their devices, such as security, parental controls, and cloud storage services. Key partnerships with technology distributors and retailers, as well as a strong global sales network, significantly contribute to Netgear's earnings.
Netgear Earnings Call Summary
Earnings Call Date:Apr 30, 2025
(Q1-2025)
| % Change Since: 10.70%|
Next Earnings Date:Jul 23, 2025
Earnings Call Sentiment Neutral
The earnings call presented a balanced view with notable achievements in the NFB segment and strategic initiatives like the acquisition of VAAG Systems. However, challenges remain with supply chain constraints, revenue declines in some segments, and a negative operating margin. Overall, NETGEAR is positioned well to continue its transformation and capitalize on geopolitical advantages.Q1-2025 Updates
Positive Updates
Strong Financial Performance
NETGEAR reported better-than-expected revenue and operating margin, driven by strong contributions from the B2B division. Non-GAAP gross margins reached 35%, highlighting improved profitability through a leaner, more effective channel strategy.
Growth in NETGEAR for Business (NFB)
The NFB segment saw revenue growth of 15.4% year-over-year. Significant contribution margin improvements and a 78% year-over-year rise in contribution profit were reported, driven by strong demand for ProAV managed switches.
Strategic Transformation and Reorganization
NETGEAR underwent a proactive reorganization in January 2025 to focus on unlocking inherent business value. This reorganization helped in freeing up cash for strategic investments and improved operational efficiency.
Successful Acquisition of VAAG Systems
The acquisition of VAAG Systems, based in Chennai, India, aims to enhance software development capabilities. This move will leverage AI for networking simplification for SMEs, reduce costs, and accelerate product innovation.
Positive Market Positioning
NETGEAR benefits from not manufacturing in China and having products exempt from tariffs, strengthening its competitive position amid geopolitical uncertainties.
Negative Updates
Revenue Declines in Mobile and Home Networking
Mobile revenue fell by 25.3% year-over-year and Home Networking revenue decreased by 8.7% year-over-year, indicating challenges in these segments.
Supply Chain Constraints
Continued supply constraints, particularly affecting the ProAV managed switch products, may limit the ability to capture full top line potential in the growing NFB segment.
Negative Operating Margin
Despite improvements, the company reported a non-GAAP operating loss of $2.6 million, with an operating margin of negative 1.6%, reflecting ongoing challenges in achieving profitability.
Uncertain Tariff Situation Impacting Hiring
Delays in hiring plans due to caution over the uncertain tariff situation, which affected the ramp-up of planned investments and operational expenses.
Company Guidance
In the recent financial results call, NETGEAR provided guidance for the second quarter of 2025, highlighting expected revenue between $155 million and $170 million. The company projects non-GAAP operating margins in the range of negative 6.5% to negative 3.5%, with a GAAP operating margin anticipated between negative 10.4% and negative 7.4%. NETGEAR foresees its gross margin to remain stable or slightly decrease from the first quarter's 35%. The company also expects GAAP tax expenses to be between $0.5 million and $1.5 million, while non-GAAP tax expenses are projected to range from $1 million to $2 million. These projections reflect the company's strategic focus on sustaining its momentum in the NFB business segment and leveraging its reorganized operational framework.Netgear Financial Statement Overview
Summary
Netgear showcases a stable financial position, with a robust balance sheet and positive operating cash flows. Despite challenges in revenue growth and operational efficiency, the company is managing its debt effectively and improving its profitability metrics. Continued focus on cost management and revenue enhancement strategies will be crucial for sustaining long-term growth.Income Statement
Netgear's TTM (Trailing-Twelve-Months) revenue has declined compared to the previous year, indicating challenges in maintaining its sales momentum. The gross profit margin stands at 30.4%, suggesting moderate efficiency in managing production costs. However, the net profit margin is low at 3.7%, reflecting difficulties in controlling operational expenses. Additionally, the EBIT and EBITDA margins are weak, indicating limited operating profitability and cash flow generation.55
Neutral
Balance Sheet
Netgear maintains a strong equity position, with an equity ratio of 65.6%. The debt-to-equity ratio is low, demonstrating prudent debt management. Return on equity has improved to 4.7% from negative figures, indicating a recovery in profitability. Overall, the balance sheet is stable, albeit with room for enhancing asset utilization.68
Positive
Cash Flow
Operating cash flow is solid relative to net income, with a ratio of 5.56, indicating strong cash generation capability. Free cash flow has grown, reflecting improved cash management. However, the free cash flow to net income ratio is high, suggesting potential overreliance on free cash flow in the short term.62
Positive
| Breakdown | |||||
| TTM | Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 | Dec 2020 |
|---|---|---|---|---|---|
| Income Statement | Total Revenue | ||||
| 671.36M | 673.76M | 740.84M | 932.47M | 1.17B | 1.26B | Gross Profit |
| 204.15M | 195.93M | 249.25M | 250.55M | 365.84M | 372.15M | EBIT |
| 31.05M | 12.22M | -33.27M | 5.96M | 66.60M | 56.61M | EBITDA |
| -53.79M | -65.80M | -25.04M | -23.82M | 80.50M | 94.47M | Net Income Common Stockholders |
| 24.98M | 12.36M | -104.77M | -68.99M | 49.39M | 58.29M |
| Balance Sheet | Cash, Cash Equivalents and Short-Term Investments | ||||
| 391.93M | 408.69M | 283.65M | 227.43M | 271.52M | 353.32M | Total Assets |
| 814.20M | 850.23M | 847.14M | 1.02B | 1.08B | 1.11B | Total Debt |
| 18.04M | 30.63M | 41.57M | 45.10M | 18.57M | 25.51M | Net Debt |
| -251.77M | -255.81M | -135.15M | -101.40M | -245.20M | -320.95M | Total Liabilities |
| 279.95M | 309.16M | 311.65M | 398.93M | 381.72M | 416.65M | Stockholders Equity |
| 534.24M | 541.07M | 535.50M | 620.86M | 696.82M | 689.38M |
| Cash Flow | Free Cash Flow | ||||
| 130.98M | 155.80M | 51.05M | -19.49M | -14.44M | 170.85M | Operating Cash Flow |
| 138.86M | 164.80M | 56.85M | -13.73M | -4.58M | 181.15M | Investing Cash Flow |
| -16.08M | -26.16M | -27.43M | -79.52M | -9.98M | -16.84M | Financing Cash Flow |
| -25.63M | -28.91M | 797.00K | -24.02M | -68.12M | -8.06M |
Netgear Technical Analysis
Neutral
26.70
Price Trends
27.12
Negative
26.37
Positive
24.73
Positive
Market Momentum
-0.09
Positive
36.49
Neutral
3.33
Positive
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For NTGR, the sentiment is Neutral. The current price of 26.7 is below the 20-day moving average (MA) of 29.32, below the 50-day MA of 27.12, and above the 200-day MA of 24.73, indicating a neutral trend. The MACD of -0.09 indicates Positive momentum. The RSI at 36.49 is Neutral, neither overbought nor oversold. The STOCH value of 3.33 is Positive, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Neutral sentiment for NTGR.
Netgear Risk Analysis
Netgear disclosed 39 risk factors in its most recent earnings report. Netgear reported the most risks in the "Finance & Corporate" category.
Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy
Latest Risks Added 0 New Risks
Netgear Peers Comparison
Overall Rating
UnderperformOutperform
Sector (62)
Financial Indicators
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
62 Neutral | $11.92B | 10.03 | -7.37% | 3.70% | 7.32% | -8.25% | |
59 Neutral | $618.65M | ― | -66.95% | ― | -10.18% | 75.30% | |
59 Neutral | $3.07B | 58.72 | -0.78% | ― | 21.80% | 89.21% | |
57 Neutral | $22.96B | 41.84 | 237.68% | 0.63% | 21.43% | 56.87% | |
56 Neutral | $787.23M | 33.49 | 4.78% | ― | -6.97% | ― | |
51 Neutral | $7.01B | ― | -1.08% | ― | -23.85% | 88.39% |
* Technology Sector Average
Performance Comparison
NTGR
Netgear
26.70
12.24
84.65%
ADTN
Adtran
7.94
2.74
52.69%
SATS
Echostar
24.87
7.66
44.51%
UI
Ubiquiti Networks
376.84
237.89
171.21%
PI
IMPINJ
104.12
-42.54
-29.01%
Netgear Corporate Events
M&A TransactionsBusiness Operations and Strategy
Netgear Announces Acquisition of Exium Inc.
Positive
Jun 5, 2025
On June 5, 2025, NETGEAR announced its agreement to acquire Exium Inc., a cybersecurity software company, to enhance its cloud-based solutions for business connectivity. This acquisition aims to integrate Exium’s Secure Access Service Edge (SASE) platform into NETGEAR’s offerings, aligning with its strategy to provide comprehensive networking and security solutions for small and medium enterprises. The transaction, expected to close by the end of Q2 2025, will not materially impact NETGEAR’s financial position for the year. Exium’s expertise will bolster NETGEAR’s ability to deliver an all-in-one solution, addressing the growing demand for cloud-based networking and security services.
The most recent analyst rating on (NTGR) stock is a Buy with a $22.00 price target. To see the full list of analyst forecasts on Netgear stock, see the NTGR Stock Forecast page.
Shareholder MeetingsBusiness Operations and Strategy
Netgear Holds Annual Stockholders Meeting with Key Votes
Neutral
May 30, 2025
On May 29, 2025, Netgear, Inc. held its Annual Meeting of Stockholders virtually, where stockholders voted on five proposals. These included the election of seven directors, ratification of PricewaterhouseCoopers as the independent auditor, approval of executive compensation, the 2025 Equity Incentive Plan, and an amendment to the 2003 Employee Stock Purchase Plan. The meeting saw significant engagement with 25,361,311 shares represented, indicating active participation from stakeholders. The results of the votes reflect the company’s ongoing governance and strategic planning efforts, with implications for its operational and financial strategies moving forward.
The most recent analyst rating on (NTGR) stock is a Buy with a $22.00 price target. To see the full list of analyst forecasts on Netgear stock, see the NTGR Stock Forecast page.
Glossary
BuyA stock rated as a "Buy" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock is likely to deliver higher returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
HoldA stock rated as a "Hold" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly compelling nor unfavorable for investment. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
SellA stock rated as a "Sell" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock may deliver lower returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
Disclaimer
This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.