PURE STORAGE INC - CLASS A (PSTG) Stock Fundamental Analysis
NYSE:PSTG - New York Stock Exchange, Inc. - US74624M1027 - Common Stock - Currency: USD
Overall PSTG gets a fundamental rating of 5 out of 10. We evaluated PSTG against 32 industry peers in the Technology Hardware, Storage & Peripherals industry. PSTG is in great health and has no worries on liquidiy or solvency at all, but the profibility rating is only average. PSTG shows excellent growth, but is valued quite expensive already. These ratings would make PSTG suitable for growth investing!
1. Profitability
1.1 Basic Checks
PSTG had positive earnings in the past year.
In the past year PSTG had a positive cash flow from operations.
The reported net income has been mixed in the past 5 years: PSTG reported negative net income in multiple years.
Each year in the past 5 years PSTG had a positive operating cash flow.
1.2 Ratios
The Return On Assets of PSTG (2.69%) is comparable to the rest of the industry.
Looking at the Return On Equity, with a value of 8.17%, PSTG is in the better half of the industry, outperforming 71.88% of the companies in the same industry.
PSTG's Return On Invested Capital of 2.99% is in line compared to the rest of the industry. PSTG outperforms 53.13% of its industry peers.
PSTG had an Average Return On Invested Capital over the past 3 years of 2.97%. This is significantly below the industry average of 15.53%.
The last Return On Invested Capital (2.99%) for PSTG is above the 3 year average (2.97%), which is a sign of increasing profitability.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 2.69% | ||
| ROE | 8.17% | ||
| ROIC | 2.99% |
ROA(3y)2.14%
ROA(5y)-1.63%
ROE(3y)6.92%
ROE(5y)-7.17%
ROIC(3y)2.97%
ROIC(5y)N/A
1.3 Margins
Looking at the Profit Margin, with a value of 3.37%, PSTG is in line with its industry, outperforming 56.25% of the companies in the same industry.
The Operating Margin of PSTG (3.19%) is comparable to the rest of the industry.
Looking at the Gross Margin, with a value of 69.84%, PSTG belongs to the top of the industry, outperforming 96.88% of the companies in the same industry.
PSTG's Gross Margin has been stable in the last couple of years.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 3.19% | ||
| PM (TTM) | 3.37% | ||
| GM | 69.84% |
OM growth 3YN/A
OM growth 5YN/A
PM growth 3YN/A
PM growth 5YN/A
GM growth 3Y1.13%
GM growth 5Y0.25%
2. Health
2.1 Basic Checks
With a Return on Invested Capital (ROIC) below the Cost of Capital (WACC), PSTG is destroying value.
Compared to 1 year ago, PSTG has more shares outstanding
Compared to 5 years ago, PSTG has more shares outstanding
Compared to 1 year ago, PSTG has an improved debt to assets ratio.
2.2 Solvency
An Altman-Z score of 4.06 indicates that PSTG is not in any danger for bankruptcy at the moment.
PSTG has a Altman-Z score of 4.06. This is amongst the best in the industry. PSTG outperforms 87.50% of its industry peers.
There is no outstanding debt for PSTG. This means it has a Debt/Equity and Debt/FCF ratio of 0 and it is amongst the best of the sector and industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0 | ||
| Debt/FCF | 0.19 | ||
| Altman-Z | 4.06 |
ROIC/WACC0.34
WACC8.89%
2.3 Liquidity
PSTG has a Current Ratio of 1.61. This is a normal value and indicates that PSTG is financially healthy and should not expect problems in meeting its short term obligations.
PSTG's Current ratio of 1.61 is in line compared to the rest of the industry. PSTG outperforms 56.25% of its industry peers.
A Quick Ratio of 1.58 indicates that PSTG should not have too much problems paying its short term obligations.
The Quick ratio of PSTG (1.58) is better than 68.75% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 1.61 | ||
| Quick Ratio | 1.58 |
3. Growth
3.1 Past
The Earnings Per Share has grown by an impressive 20.42% over the past year.
Measured over the past years, PSTG shows a very strong growth in Earnings Per Share. The EPS has been growing by 45.75% on average per year.
The Revenue has grown by 11.92% in the past year. This is quite good.
Measured over the past years, PSTG shows a quite strong growth in Revenue. The Revenue has been growing by 14.03% on average per year.
EPS 1Y (TTM)20.42%
EPS 3Y33.42%
EPS 5Y45.75%
EPS Q2Q%-10%
Revenue 1Y (TTM)11.92%
Revenue growth 3Y13.26%
Revenue growth 5Y14.03%
Sales Q2Q%11.4%
3.2 Future
The Earnings Per Share is expected to grow by 11.59% on average over the next years. This is quite good.
PSTG is expected to show quite a strong growth in Revenue. In the coming years, the Revenue will grow by 14.35% yearly.
EPS Next Y1.37%
EPS Next 2Y13.44%
EPS Next 3Y11.59%
EPS Next 5YN/A
Revenue Next Year11.06%
Revenue Next 2Y12.54%
Revenue Next 3Y11.47%
Revenue Next 5Y14.35%
3.3 Evolution
The estimated forward EPS growth is still strong, although it is decreasing when compared to the stronger growth in the past years.
When comparing the Revenue growth rate of the last years to the growth rate of the upcoming years, we see that the growth is stable.
4. Valuation
4.1 Price/Earnings Ratio
With a Price/Earnings ratio of 26.73, PSTG can be considered very expensive at the moment.
The rest of the industry has a similar Price/Earnings ratio as PSTG.
PSTG is valuated at similar levels of the S&P average when we compare the Price/Earnings ratio to 28.79, which is the current average of the S&P500 Index.
A Price/Forward Earnings ratio of 26.36 indicates a quite expensive valuation of PSTG.
Compared to the rest of the industry, the Price/Forward Earnings ratio of PSTG indicates a slightly more expensive valuation: PSTG is more expensive than 62.50% of the companies listed in the same industry.
PSTG is valuated rather expensively when we compare the Price/Forward Earnings ratio to 21.38, which is the current average of the S&P500 Index.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 26.73 | ||
| Fwd PE | 26.36 |
4.2 Price Multiples
PSTG's Enterprise Value to EBITDA is on the same level as the industry average.
Compared to the rest of the industry, the Price/Free Cash Flow ratio of PSTG indicates a somewhat cheap valuation: PSTG is cheaper than 65.63% of the companies listed in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 28.28 | ||
| EV/EBITDA | 55.66 |
4.3 Compensation for Growth
The high PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates an expensive valuation of the company.
PEG (NY)19.54
PEG (5Y)0.58
EPS Next 2Y13.44%
EPS Next 3Y11.59%
5. Dividend
5.1 Amount
PSTG does not give a dividend.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | N/A |
45.7
+0.57 (+1.26%)
Chartmill FA Rating
GICS SectorInformation Technology
GICS IndustryGroupTechnology Hardware & Equipment
GICS IndustryTechnology Hardware, Storage & Peripherals
Earnings (Last)
Earnings (Next)
Inst Owners86.02%
Inst Owner Change-48%
Ins Owners4.88%
Ins Owner Change-7.06%
Market Cap14.90B
Analysts80
Price Target70.54 (54.35%)
Short Float %3.41%
Short Ratio3.3
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | N/A |
Yearly DividendN/A
Dividend Growth(5Y)N/A
DPN/A
Div Incr Years0
Div Non Decr Years0
Ex-DateN/A
Surprises & Revisions
EPS beat(2)2
Avg EPS beat(2)11.87%
Min EPS beat(2)6.36%
Max EPS beat(2)17.38%
EPS beat(4)4
Avg EPS beat(4)21.85%
Min EPS beat(4)6.36%
Max EPS beat(4)47.07%
EPS beat(8)8
Avg EPS beat(8)31.61%
EPS beat(12)12
Avg EPS beat(12)68.19%
EPS beat(16)16
Avg EPS beat(16)74.03%
Revenue beat(2)0
Avg Revenue beat(2)-0.37%
Min Revenue beat(2)-0.73%
Max Revenue beat(2)-0.01%
Revenue beat(4)0
Avg Revenue beat(4)-0.43%
Min Revenue beat(4)-0.83%
Max Revenue beat(4)-0.01%
Revenue beat(8)1
Avg Revenue beat(8)-0.28%
Revenue beat(12)2
Avg Revenue beat(12)0.9%
Revenue beat(16)6
Avg Revenue beat(16)1.81%
PT rev (1m)-3.17%
PT rev (3m)-3.02%
EPS NQ rev (1m)-0.55%
EPS NQ rev (3m)-22.96%
EPS NY rev (1m)-1.26%
EPS NY rev (3m)-4.19%
Revenue NQ rev (1m)-0.14%
Revenue NQ rev (3m)0.03%
Revenue NY rev (1m)-0.33%
Revenue NY rev (3m)-0.45%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 26.73 | ||
| Fwd PE | 26.36 | ||
| P/S | 4.7 | ||
| P/FCF | 28.28 | ||
| P/OCF | 19.77 | ||
| P/B | 11.4 | ||
| P/tB | 16.09 | ||
| EV/EBITDA | 55.66 |
EPS(TTM)1.71
EY3.74%
EPS(NY)1.73
Fwd EY3.79%
FCF(TTM)1.62
FCFY3.54%
OCF(TTM)2.31
OCFY5.06%
SpS9.72
BVpS4.01
TBVpS2.84
PEG (NY)19.54
PEG (5Y)0.58
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 2.69% | ||
| ROE | 8.17% | ||
| ROCE | 4.27% | ||
| ROIC | 2.99% | ||
| ROICexc | 8.37% | ||
| ROICexgc | 15.21% | ||
| OM | 3.19% | ||
| PM (TTM) | 3.37% | ||
| GM | 69.84% | ||
| FCFM | 16.63% |
ROA(3y)2.14%
ROA(5y)-1.63%
ROE(3y)6.92%
ROE(5y)-7.17%
ROIC(3y)2.97%
ROIC(5y)N/A
ROICexc(3y)14.68%
ROICexc(5y)N/A
ROICexgc(3y)N/A
ROICexgc(5y)N/A
ROCE(3y)4.24%
ROCE(5y)N/A
ROICexcg growth 3YN/A
ROICexcg growth 5YN/A
ROICexc growth 3YN/A
ROICexc growth 5YN/A
OM growth 3YN/A
OM growth 5YN/A
PM growth 3YN/A
PM growth 5YN/A
GM growth 3Y1.13%
GM growth 5Y0.25%
F-Score7
Asset Turnover0.8
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0 | ||
| Debt/FCF | 0.19 | ||
| Debt/EBITDA | 0 | ||
| Cap/Depr | 179.01% | ||
| Cap/Sales | 7.16% | ||
| Interest Coverage | 14.09 | ||
| Cash Conversion | 330.8% | ||
| Profit Quality | 493.61% | ||
| Current Ratio | 1.61 | ||
| Quick Ratio | 1.58 | ||
| Altman-Z | 4.06 |
F-Score7
WACC8.89%
ROIC/WACC0.34
Cap/Depr(3y)164.45%
Cap/Depr(5y)150.4%
Cap/Sales(3y)6.6%
Cap/Sales(5y)6.02%
Profit Quality(3y)704.64%
Profit Quality(5y)N/A
High Growth Momentum
Growth
EPS 1Y (TTM)20.42%
EPS 3Y33.42%
EPS 5Y45.75%
EPS Q2Q%-10%
EPS Next Y1.37%
EPS Next 2Y13.44%
EPS Next 3Y11.59%
EPS Next 5YN/A
Revenue 1Y (TTM)11.92%
Revenue growth 3Y13.26%
Revenue growth 5Y14.03%
Sales Q2Q%11.4%
Revenue Next Year11.06%
Revenue Next 2Y12.54%
Revenue Next 3Y11.47%
Revenue Next 5Y14.35%
EBIT growth 1Y16.06%
EBIT growth 3YN/A
EBIT growth 5YN/A
EBIT Next Year35.48%
EBIT Next 3Y27.62%
EBIT Next 5YN/A
FCF growth 1Y9.18%
FCF growth 3Y19.62%
FCF growth 5Y41.52%
OCF growth 1Y11.2%
OCF growth 3Y22.49%
OCF growth 5Y31.78%