NetApp (NTAP) heads into its upcoming earnings release with investor attention focused on two fronts: recent sector driven valuation resets and the company’s push into AI infrastructure, Keystone storage services, and public cloud offerings.

The recent 1 day share price return of 2.01% to US$101.88 comes after weeks of mixed signals, with a 30 day share price return of 3.11% but a 90 day decline of 6.75%. The 1 year total shareholder return of 16.47% decline contrasts with stronger 3 and 5 year total shareholder returns of 68.28% and 79.73% respectively, suggesting long term holders have fared better even as short term momentum has cooled ahead of earnings and ongoing sector wide valuation resets.

If NetApp’s AI push has caught your attention, this could be a good moment to broaden your research and scan 33 AI infrastructure stocks as potential peers to compare.

With NetApp trading at US$101.88 and data points indicating a discount to some analyst targets and intrinsic value estimates, the key question is whether the recent reset leaves potential upside available or if the market has already fully reflected expectations for future growth.

Most Popular Narrative: 17% Undervalued

With NetApp last closing at $101.88 against a widely followed fair value estimate of $122.81, the core narrative is built around AI, cloud, and margin execution supporting that higher valuation.

Accelerating adoption of AI and analytics workloads across industries is driving demand for unified, high-performance, and scalable data infrastructure, with NetApp securing over 125 AI wins in Q1 (more than doubling year-over-year); this trend is expected to drive revenue and earnings growth as AI deployments move from proofs-of-concept to large-scale production.

Curious what sits behind that confidence in AI and cloud earnings power? The narrative leans on steady top line growth, firmer profit margins, and a lower future earnings multiple than many tech peers. The full story connects these pieces into one valuation playbook.

Result: Fair Value of $122.81 (UNDERVALUED)

However, the AI and cloud story still faces pressure from mixed hardware demand and memory related concerns, as well as ongoing shifts toward hyperscalers that could squeeze margins.

Next Steps

That bullish tone on AI, cloud, and margins is only one side of the story, so move quickly to review the underlying numbers and shape your own view with 5 key rewards.

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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.