NetApp Acquires DataPelago to Boost AI Data Infrastructure

Evercore upgraded NetApp to Outperform from In Line on Wednesday, with analyst Amit Daryanani raising his price target to $300 from $210. Shares rose 1.6% in premarket trading. Daryanani wrote that NetApp's roughly 17% FY27 revenue-growth guide leaves meaningful room for upside, with Q1 actuals plus the Q2 guide midpoint implying first-half growth of about 26% before decelerating to only about 9% in the second half, and even excluding Q1's extra week first-half growth remains about 24%. He said a return toward more traditional second-half seasonality and continued conversion of larger AI opportunities could support low-20% FY27 growth, and that NetApp could earn as much as $15 per share or more in the long run as its core storage business expands on double-digit revenue growth driven by artificial intelligence. The analyst also noted NetApp could lift EBIT margins by passing along rising NAND prices to customers, bringing gross margins to the high-60% range, while its total addressable market expands beyond traditional storage, supporting a path toward $11-12 of FY27 EPS and ultimately $15+ of EPS power.

Jim Cramer said on the October 1 episode of Mad Money that Everpure, Inc. could have more room to run after the stock gained 66% in the third quarter, when the S&P 500 rose just 2.03%. Cramer noted that Everpure, which joined the S&P 500 in September, has become a hyperscaler play after Meta chose it to handle some of its storage. The company expanded that business on August 10 with a design win for its DirectFlash technology with a second top-five hyperscaler, and its fiscal second-quarter 2027 results showed remaining performance obligations rising 44% year-over-year to approximately $4.1 billion and subscription annual recurring revenue up 20% to approximately $2.1 billion. On September 23, management maintained its fiscal 2027 revenue forecast of $5.03 billion to $5.07 billion and introduced a preliminary fiscal 2028 outlook of $7 billion to $7.3 billion, representing expected growth of 39% to 45%, with non-GAAP operating income projected at $1.7 billion to $1.9 billion versus fiscal 2027 guidance of $940 million to $960 million. Those gains have come alongside negative operating cash flow of approximately $136 million and negative free cash flow of approximately $238 million in the fiscal second quarter, a GAAP operating margin of 5.3% against a non-GAAP margin of 19.4%, and a forward earnings multiple of approximately 45x versus approximately 21.4x for storage competitor NetApp. Insider Monkey's database of more than 1,000 hedge funds showed 51 funds holding Everpure at the end of the second quarter, up from 47 in the prior quarter, with Renaissance Technologies the top holder and short interest at 2.88% of the public float as of mid-September.

Diskover Data announced a new collaboration with NetApp that extends the Diskover Platform's governed visibility and control to ONTAP and StorageGRID environments in media and entertainment, semiconductor design, and other file-intensive sectors. Under the collaboration, customers will be able to purchase Diskover Platform through NetApp beginning in November 2026, with the platform available now for NetApp ONTAP and StorageGRID environments. Diskover's DataDiscovery uses specialized scanners to index metadata in place across ONTAP and StorageGRID, capturing ownership, permissions, age, cost, and project context in a searchable, governed catalog. Diskover says customers typically reclaim 10 to 30 percent of their footprint, exceeding three million dollars in larger environments, with return on investment inside 30 to 60 days. Will Hall, Chief Executive Officer of Diskover Data, said the collaboration gives NetApp customers a governed, searchable view of the data behind their projects, while Sandeep Singh, Senior Vice President and General Manager, Platform at NetApp, said Diskover extends the NetApp ecosystem with specialized discovery for customers with file-intensive workloads.

Sandisk Corporation reported $8.97 billion in fiscal fourth-quarter revenue, with $2.98 billion coming from data centers, roughly 33% of the quarter's total, while edge revenue was $5.43 billion and consumer revenue $556 million. Data-center revenue rose from $213 million a year earlier, and its full-year contribution was $5.15 billion out of total sales of $20.25 billion, or about 25%. The company earned $6.90 billion in the quarter and $11.43 billion in fiscal 2026, and reported an 84.6% GAAP gross margin while guiding to an 83% to 84.9% GAAP range for the next quarter. On August 13, Sandisk said eight structured customer agreements covered roughly half of fiscal 2027 bits and two-thirds of fiscal 2028 bits, with minimum financial guarantees, and management's fiscal 2028 to 2030 model targets about 80% adjusted gross margin and 50% adjusted free-cash-flow margin. Short interest stood at 5,618,213 shares on September 15, about 3.8% of float and 0.56 days to cover, and Insider Monkey's hedge fund database counted 128 hedge-fund holders in Q2 2026, up from 114 in Q1.

NetApp shares jumped 6% in the afternoon session after the data storage company unveiled a new AI factory architecture at its Insight conference, according to TipRanks. The company also launched Keystone Sovereign for regulated markets and expanded its partnerships with Oracle and Supermicro. The combined package of AI factory architecture, sovereign cloud storage, and larger OEM ties sparked optimism among investors and analysts, who lifted their price targets on the back of the AI storage narrative. NetApp is up 113% since the beginning of the year and, at $226.50 per share, has set a new 52-week high. The stock has been volatile, with 12 moves greater than 5% over the last year, and its biggest recent move came four months ago, when it gained 26.4% after reporting first-quarter 2026 results that beat expectations, with revenue up 12.5% year-over-year to $1.95 billion and adjusted earnings per share of $2.43.

NetApp delivered a record first quarter of fiscal 2027, with non-GAAP earnings of $2.58 per share, up 66.5% year over year and beating the Zacks Consensus Estimate of $2.13 by 21.1%, sending shares up about 16% since the report. Net revenues rose 29.9% to $2,025 million, surpassing the $1,843 million consensus mark by 9.9%, while billings increased 36.1% to $2,057 million. Within the total, Hybrid Cloud revenues advanced 30.1% year over year to $1,819 million, all-flash array revenues reached a record $1,309 million, up 46.6%, and Public Cloud revenues grew 28% to a record $206 million; together, all-flash and Public Cloud represented 75% of quarterly net revenues. The quarter included an additional week that contributed approximately $65 million to revenues, mainly from support and Public Cloud, and excluding that benefit total revenues increased 26% year over year. For fiscal 2027, NetApp now forecasts revenues of $7.975-$8.225 billion, with the $8.10 billion midpoint representing 17% growth and a $650 million increase from prior guidance, and earnings of $9.73-$10.03 per share, whose $9.88 midpoint represents 22% year-over-year growth.