Pure Storage faces challenges amid market downturn
Written by Emily J. Thompson, Senior Investment Analyst
Updated: May 30 2024
0mins
Should l Buy PSTG?
Source: Coinmarketcap
Pure Storage Inc. shares fell by 5.52% as the stock crossed below its 5-day SMA, reflecting broader market weakness with the Nasdaq-100 down 1.34% and S&P 500 down 0.83%.
The investment analysis highlights that while Sandisk's stock surged significantly due to memory chip supply shortages, Pure Storage's shares have remained stable, indicating differing market expectations. Additionally, the earnings growth rate for Pure Storage is projected at 23%, which is lower compared to Sandisk's 410%, suggesting a lack of investor confidence amid the current market conditions.
This performance may raise concerns among investors regarding Pure Storage's ability to compete effectively in the storage sector, especially as it faces challenges in profitability compared to its competitors.
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Analyst Views on PSTG
Wall Street analysts forecast PSTG stock price to rise
20 Analyst Rating
14 Buy
5 Hold
1 Sell
Moderate Buy
Current: 72.690
Low
60.00
Averages
97.37
High
120.00
Current: 72.690
Low
60.00
Averages
97.37
High
120.00
About PSTG
Pure Storage, Inc. is a data management and storage company. The Company is focused on delivering a disruptive data storage platform, which supports a range of structured and unstructured data at scale and across any data workloads in on premises, cloud and hosted environments and includes mission-critical production, test and development, analytics, disaster recovery, backup and restore, artificial intelligence (AI) and machine learning. Its integrated hardware systems include Evergreen Architecture, FlashArray, and FlashBlade. Its cloud-native storage includes Portworx by Pure Storage, Portworx Data Services, Cloud Block Store, Evergreen//One, and Evergreen//Flex. Its Pure Software includes Purity, Pure1, and Pure Fusion. Its Pure1 is a cloud-based data storage management plane, brings the convenience of cloud storage to on premises storage. The Company sells its products and subscription services using a direct sales force and its channel partners.
About the author
Emily J. Thompson
Emily J. Thompson, a Chartered Financial Analyst (CFA) with 12 years in investment research, graduated with honors from the Wharton School. Specializing in industrial and technology stocks, she provides in-depth analysis for Intellectia’s earnings and market brief reports.
Investment Analysis in Storage Sector: Sandisk vs. Pure Storage
- Market Performance Comparison: Sandisk's stock surged 1,560% over the past year due to memory chip supply shortages, while Pure Storage's shares have remained stable, indicating differing market expectations for the two companies.
- Analyst Price Targets: Sandisk has a median target price of $717.50 per share, implying a 20% upside from its current price of $598, whereas Pure Storage's target price of $100 per share suggests a 40% upside, reflecting greater market confidence in the latter.
- Technological Advantages: Sandisk enhances its competitiveness in the NAND flash market through collaboration with Kioxia, sharing R&D and capital expenditures, while Pure Storage offers superior storage density and lower power consumption with its 3D NAND and Evergreen architecture, making it ideal for AI workloads.
- Earnings Expectations: Sandisk reported a 404% growth in non-GAAP earnings last quarter, with an expected annual growth rate of 410% through fiscal 2027; in contrast, Pure Storage achieved a 16% growth in non-GAAP earnings, with a projected annual growth rate of 23%, highlighting significant differences in profitability between the two companies.
See More
Broadcom Leads Surge in AI Chip Revenue
- Key Factors in AI Economy: Futurum Equities' latest AI Fifteen report identifies computing, data, deployment, and security as critical factors defining the AI economy, emphasizing their importance for future development.
- Broadcom Revenue Growth: Broadcom (NASDAQ:AVGO) reported AI chip revenue of $6.5 billion this quarter, with guidance of $8.2 billion next quarter, indicating nearly 100% year-over-year growth and showcasing its strong performance in the AI market.
- Backlog Situation: The company's backlog across XPUs, switches, optics, and racks exceeds $73 billion, reflecting its dominant position in the AI semiconductor market and ongoing growth potential.
- Competitive Market Advantage: Broadcom launched its first Wi-Fi 8 access point and switch, further solidifying its position in the AI-driven networking market, while ranking in the 96th percentile for quality and 78th for momentum in Benzinga's performance metrics, demonstrating its robust market performance.
See More
Pure Storage Enhances Partner Program for Differentiated Solutions
- Partner Program Upgrade: Pure Storage has updated its partner program by introducing a new Ambassador tier, aimed at enhancing partners' market competitiveness through increased technical expertise and solution specialization, thereby accelerating customer modernization efforts.
- Solutions-Oriented Focus: The new program emphasizes data-centric services, particularly within the Managed Services Provider (MSP) partner program, ensuring partners can quickly adapt to customer needs and deliver measurable business value, enhancing customer trust.
- Market Differentiation: By introducing Solution Practice Designations, Pure Storage enables its partners to achieve clear differentiation in the market, helping customers navigate modern infrastructure and cyber risks, thus improving their recovery capabilities.
- Technical Support and Incentives: Pure Storage supports partners in building scalable solutions and simplifying operations through tools and incentives, ensuring they maintain a competitive edge in a rapidly changing market environment.
See More
2026 AI Investor Outlook: 90% of Investors Plan to Increase AI Stock Holdings
- Investor Confidence: A survey of 2,600 American adults revealed that 36% of AI stockholders plan to increase their holdings, 57% will maintain their positions, and only 7% intend to reduce, indicating strong investor confidence in AI despite bubble concerns.
- Long-Term Return Expectations: 62% of respondents believe that AI-heavy companies will deliver strong long-term returns, with this figure rising to 93% among those already invested, reflecting widespread trust in the future value of AI technology.
- Technological Advancements and Cost Reductions: The intelligence per dollar ratio of AI models doubles approximately every six months, with the cost of GPT-5 mini dropping to just $2 per million tokens, indicating rapid adoption and decreasing costs for businesses, thus facilitating broader industry applications.
- Market Adaptation and Investment Strategies: Analysts recommend that investors focus on smaller semiconductor and data center ecosystem companies, such as high bandwidth memory providers and data storage designers, which play critical roles in the AI value chain and may present significant investment opportunities in the future.
See More
2026 AI Investor Outlook Report: 62% of Investors Bullish on AI Companies
- Investor Confidence: A survey of 2,600 American adults revealed that 36% of AI stockholders plan to increase their holdings, 57% will maintain their positions, and only 7% intend to reduce, indicating strong investor confidence in AI despite bubble concerns.
- Long-Term Return Expectations: 62% of respondents believe that AI-heavy companies will deliver strong long-term returns, with this figure rising to 93% among those already invested, highlighting optimism about the value creation potential of AI technologies.
- Technological Advancements and Cost Reductions: The intelligence per dollar ratio of AI models has doubled approximately every six months, with the cost of GPT-5 Mini dropping to just $2 per million tokens, showcasing rapid advancements in AI technology and its potential for widespread adoption across industries.
- Market Health: Despite bubble risks, the actual application of AI technology and the increase in investor confidence suggest that the market is moving towards a healthier state, with significant growth in corporate investment and adoption rates in AI, reflecting real commercial value.
See More
PURE Storage (PSTG) Options Volume Hits 28,619 Contracts, 84.3% of Average Daily Volume
- Active Options Trading: PURE Storage's options volume reached 28,619 contracts today, equivalent to approximately 2.9 million shares, representing 84.3% of its average daily trading volume over the past month, indicating strong market interest in the stock.
- High Strike Call Options: Notably, the $75 strike call option expiring on January 16, 2026, has seen a trading volume of 3,939 contracts today, representing about 393,900 underlying shares, suggesting investor expectations for future price increases.
- Lemonade Options Activity: Concurrently, Lemonade Inc recorded an options trading volume of 17,181 contracts, approximately 1.7 million shares, accounting for 81.3% of its average daily trading volume over the past month, reflecting the stock's active trading environment.
- Bullish Call Option Trend: The $90 strike call option for Lemonade, expiring on January 16, 2026, has a trading volume of 1,917 contracts today, equivalent to about 191,700 shares, indicating optimistic market sentiment regarding its future performance.
See More
Investment Analysis in Storage Sector: Sandisk vs. Pure Storage
- Market Performance Comparison: Sandisk's stock surged 1,560% over the past year due to memory chip supply shortages, while Pure Storage's shares have remained stable, indicating differing market expectations for the two companies.
- Analyst Price Targets: Sandisk has a median target price of $717.50 per share, implying a 20% upside from its current price of $598, whereas Pure Storage's target price of $100 per share suggests a 40% upside, reflecting greater market confidence in the latter.
- Technological Advantages: Sandisk enhances its competitiveness in the NAND flash market through collaboration with Kioxia, sharing R&D and capital expenditures, while Pure Storage offers superior storage density and lower power consumption with its 3D NAND and Evergreen architecture, making it ideal for AI workloads.
- Earnings Expectations: Sandisk reported a 404% growth in non-GAAP earnings last quarter, with an expected annual growth rate of 410% through fiscal 2027; in contrast, Pure Storage achieved a 16% growth in non-GAAP earnings, with a projected annual growth rate of 23%, highlighting significant differences in profitability between the two companies.
See More
Broadcom Leads Surge in AI Chip Revenue
- Key Factors in AI Economy: Futurum Equities' latest AI Fifteen report identifies computing, data, deployment, and security as critical factors defining the AI economy, emphasizing their importance for future development.
- Broadcom Revenue Growth: Broadcom (NASDAQ:AVGO) reported AI chip revenue of $6.5 billion this quarter, with guidance of $8.2 billion next quarter, indicating nearly 100% year-over-year growth and showcasing its strong performance in the AI market.
- Backlog Situation: The company's backlog across XPUs, switches, optics, and racks exceeds $73 billion, reflecting its dominant position in the AI semiconductor market and ongoing growth potential.
- Competitive Market Advantage: Broadcom launched its first Wi-Fi 8 access point and switch, further solidifying its position in the AI-driven networking market, while ranking in the 96th percentile for quality and 78th for momentum in Benzinga's performance metrics, demonstrating its robust market performance.
See More
Pure Storage Enhances Partner Program for Differentiated Solutions
- Partner Program Upgrade: Pure Storage has updated its partner program by introducing a new Ambassador tier, aimed at enhancing partners' market competitiveness through increased technical expertise and solution specialization, thereby accelerating customer modernization efforts.
- Solutions-Oriented Focus: The new program emphasizes data-centric services, particularly within the Managed Services Provider (MSP) partner program, ensuring partners can quickly adapt to customer needs and deliver measurable business value, enhancing customer trust.
- Market Differentiation: By introducing Solution Practice Designations, Pure Storage enables its partners to achieve clear differentiation in the market, helping customers navigate modern infrastructure and cyber risks, thus improving their recovery capabilities.
- Technical Support and Incentives: Pure Storage supports partners in building scalable solutions and simplifying operations through tools and incentives, ensuring they maintain a competitive edge in a rapidly changing market environment.
See More
2026 AI Investor Outlook: 90% of Investors Plan to Increase AI Stock Holdings
- Investor Confidence: A survey of 2,600 American adults revealed that 36% of AI stockholders plan to increase their holdings, 57% will maintain their positions, and only 7% intend to reduce, indicating strong investor confidence in AI despite bubble concerns.
- Long-Term Return Expectations: 62% of respondents believe that AI-heavy companies will deliver strong long-term returns, with this figure rising to 93% among those already invested, reflecting widespread trust in the future value of AI technology.
- Technological Advancements and Cost Reductions: The intelligence per dollar ratio of AI models doubles approximately every six months, with the cost of GPT-5 mini dropping to just $2 per million tokens, indicating rapid adoption and decreasing costs for businesses, thus facilitating broader industry applications.
- Market Adaptation and Investment Strategies: Analysts recommend that investors focus on smaller semiconductor and data center ecosystem companies, such as high bandwidth memory providers and data storage designers, which play critical roles in the AI value chain and may present significant investment opportunities in the future.
See More
2026 AI Investor Outlook Report: 62% of Investors Bullish on AI Companies
- Investor Confidence: A survey of 2,600 American adults revealed that 36% of AI stockholders plan to increase their holdings, 57% will maintain their positions, and only 7% intend to reduce, indicating strong investor confidence in AI despite bubble concerns.
- Long-Term Return Expectations: 62% of respondents believe that AI-heavy companies will deliver strong long-term returns, with this figure rising to 93% among those already invested, highlighting optimism about the value creation potential of AI technologies.
- Technological Advancements and Cost Reductions: The intelligence per dollar ratio of AI models has doubled approximately every six months, with the cost of GPT-5 Mini dropping to just $2 per million tokens, showcasing rapid advancements in AI technology and its potential for widespread adoption across industries.
- Market Health: Despite bubble risks, the actual application of AI technology and the increase in investor confidence suggest that the market is moving towards a healthier state, with significant growth in corporate investment and adoption rates in AI, reflecting real commercial value.
See More
PURE Storage (PSTG) Options Volume Hits 28,619 Contracts, 84.3% of Average Daily Volume
- Active Options Trading: PURE Storage's options volume reached 28,619 contracts today, equivalent to approximately 2.9 million shares, representing 84.3% of its average daily trading volume over the past month, indicating strong market interest in the stock.
- High Strike Call Options: Notably, the $75 strike call option expiring on January 16, 2026, has seen a trading volume of 3,939 contracts today, representing about 393,900 underlying shares, suggesting investor expectations for future price increases.
- Lemonade Options Activity: Concurrently, Lemonade Inc recorded an options trading volume of 17,181 contracts, approximately 1.7 million shares, accounting for 81.3% of its average daily trading volume over the past month, reflecting the stock's active trading environment.
- Bullish Call Option Trend: The $90 strike call option for Lemonade, expiring on January 16, 2026, has a trading volume of 1,917 contracts today, equivalent to about 191,700 shares, indicating optimistic market sentiment regarding its future performance.
See More
