NTCTNetScout Systems, Inc.
Is the business good?
A genuinely good business: earnings fully cash-backed (2.4×) and margins widening.
Mixed fundamental signals. Nine pass/fail tests of year-over-year health from the filings.
Operating profit is fully backed by cash. Conversion is worsening vs a year ago.
Positive operating leverage, operating profit is growing faster than sales, so margins widen as the business scales.
A balanced mix of margins, efficiency, and leverage. ROE 6% = margin × turnover × leverage.
Unless marked, from derived.
Against the whole market›
Percentile against every name Ryufin tracks. Higher is better; the tick marks the middle of the market. Context, not one of the checks above.
Where this answer is blind. The F-score rewards improvement, so an already-elite company can score mid-pack.
How good a business is NTCT?
NetScout Systems, Inc. earns 10% on the capital it employs against a 9.0% cost of capital, so the business is worth more the bigger it gets.
Return on invested capital · cost of capital 9.0% · 1.0 points above what the capital costs: growth creates value
- Operating margin
- 15%
Operating margin · Software - Infrastructure median 5.8% · 12 months to Q1 2027
- Cash conversion
- 2.41×
Cash conversion · 3.31× a year ago · operating cash flow covers the operating profit after tax
- Share count, year on year
- +4.0%
Share count, year on year · shareholders own a smaller slice than a year ago
| Year | Operating margin |
|---|---|
| FY2021 | 4.5% |
| FY2022 | 5.7% |
| FY2023 | 8.5% |
| FY2024 | −18% |
| FY2025 | −45% |
| FY2026 | 13% |
Details›
- Gross margin12 months to Q1 2027
- 80%
- Operating margin12 months to Q1 2027
- 15%
- Net margin12 months to Q1 2027
- 14%
- Free cash flow margin
- 30%
- R&D as % of revenue
- 18%
- Revenue, trailing twelve months
- $883M
- Free cash flow, trailing twelve months
- $261M
- Net income, trailing twelve months
- $121M
- Return on invested capitaloperating profit after tax ÷ debt + equity − cash
- 10%
Margins, capital and share counts from the statements as filed with the SEC; cash conversion is operating cash flow over operating profit after tax.
Software, Infrastructure
Ranks #27 of 80 by RyuScore