NetScout Systems

NTCT

Software - Infrastructure · Technology

Price

$41.30

+0.46 (+1.13%)

Market Cap

$2.95B

Exchange

NASDAQ

Winston Score

Winston is happy

A high-quality business with solid fundamentals.

Share count falling — buybacks

−4.5% over 4y

The company has reduced its share count over this period, returning value to shareholders through buybacks.

Diluted shares outstanding: 75.1M (2022) → 71.7M (2026)

NetScout Systems, Inc. provides service assurance and cybersecurity solutions for protect digital business services against disruptions in the United States, Europe, Asia, and internationally. The company offers nGeniusONE management software that enables customers to predict, preempt, and resolve network and service delivery problems, as well as facilitate the optimization and capacity planning of their network infrastructures; and specialized platforms and analytic modules that enable its cust

Winston Score History

Growth Profile

For growth stock investors

When traditional metrics don't capture the full picture, these are the signals growth stock investors use instead.

Revenue Growth

-1.0% YoY

YoY Growth Rate

Revenue declining

EPS Growth

-3.8% YoY

YoY Growth Rate

Earnings declining

R&D Spend

$159M/ year

→ Flat (+4% vs prior year)

18.5% of revenue

In line with sector average (15%)

Steady R&D investment year-over-year

Insider Activity

5.5%ownership

→ Flat

Insiders holding steady — not selling despite ability to

Cash Position

Cash flow positive

$586M cash & investments

Quarterly Free Cash Flow

↑ Burn rate improving

Company generates more cash than it spends — no dilution risk from fundraising

Revenue declining

NetScout Systems's revenue is actually shrinking. In a growth stock, that removes the core investment thesis. The low Winston Score here may be warranted — unless there's a turnaround story.

The Winston Score above measures business quality today. Growth stocks often score lower because they invest in the future rather than maximising current profits. These metrics show what matters most for evaluating that future.

Score breakdown

Every number that matters to educated investors.

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Quality

Gross Margin

72.9%

Premium pricing power — 72.9% gross margin

Operating Margin

9.7%

Modest — 9.7% operating margin

ROCE

1.2%

Weak — 1.2% return on capital

ROIC between 0% and 5%. They earn a few cents back per dollar invested in the business.

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Growth

Sales YoY

+5.3%

Slow sales growth (5.3% YoY)

EPS YoY

+445.7%

Earnings growing fast (445.7% YoY)

Earnings growing 25%+ a year. The compounder zone.

EPS Consistency

8/8 quarters

Every recent quarter grew earnings vs last year

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Cash Flow

Cash Conversion

308%

Turns 308% of profit into real cash

FCF Margin

40.3%

Converts sales into free cash efficiently (40.3%)

Free cash flow margin above 20%. Out of every $100 in sales, more than $20 is real cash they keep.

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Stability

Debt / Equity

0.02

Conservative — low debt load (0.02)

Interest Cover

83.01x

Comfortably covers interest (83.0x)

Interest coverage above 8. Profits cover interest many times over.

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Valuation

P/E Ratio (TTM)

25.3x

Growth-priced — P/E 25.3

P/E above the market average. People are paying up for expected growth.

P/E vs Forward

+10.4

GROWING

Earnings expected to grow meaningfully — cheaper on forward P/E (25.3 → 15.0)

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Dividends

Not applicable for this business.

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