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 is valied quite expensively at the moment, while it does show a decent growth rate.
1. Profitability
1.1 Basic Checks
PSTG had positive earnings in the past year.
PSTG had a positive operating cash flow in the past year.
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
With a decent Return On Assets value of 3.35%, PSTG is doing good in the industry, outperforming 68.75% of the companies in the same industry.
PSTG's Return On Equity of 10.27% is fine compared to the rest of the industry. PSTG outperforms 78.13% of its industry peers.
PSTG has a Return On Invested Capital (2.90%) which is comparable to the rest of the industry.
PSTG had an Average Return On Invested Capital over the past 3 years of 2.97%. This is significantly below the industry average of 16.63%.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 3.35% | ||
| ROE | 10.27% | ||
| ROIC | 2.9% |
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 3.93%, PSTG is in the better half of the industry, outperforming 62.50% of the companies in the same industry.
Looking at the Operating Margin, with a value of 2.95%, PSTG is in line with its industry, outperforming 50.00% of the companies in the same industry.
The Gross Margin of PSTG (69.26%) is better than 96.88% of its industry peers.
In the last couple of years the Gross Margin of PSTG has remained more or less at the same level.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 2.95% | ||
| PM (TTM) | 3.93% | ||
| GM | 69.26% |
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
PSTG has a Return on Invested Capital (ROIC), which is below the Cost of Capital (WACC), which means it is destroying value.
PSTG has more shares outstanding than it did 1 year ago.
PSTG has more shares outstanding than it did 5 years ago.
PSTG has a better debt/assets ratio than last year.
2.2 Solvency
PSTG has an Altman-Z score of 5.13. This indicates that PSTG is financially healthy and has little risk of bankruptcy at the moment.
With an excellent Altman-Z score value of 5.13, PSTG belongs to the best of the industry, outperforming 84.38% of the companies in the same industry.
PSTG has a debt to FCF ratio of 0.18. This is a very positive value and a sign of high solvency as it would only need 0.18 years to pay back of all of its debts.
Looking at the Debt to FCF ratio, with a value of 0.18, PSTG belongs to the top of the industry, outperforming 93.75% of the companies in the same industry.
A Debt/Equity ratio of 0.00 indicates that PSTG is not too dependend on debt financing.
PSTG has a Debt to Equity ratio of 0.00. This is amongst the best in the industry. PSTG outperforms 84.38% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0 | ||
| Debt/FCF | 0.18 | ||
| Altman-Z | 5.13 |
ROIC/WACC0.32
WACC8.95%
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 has a Current ratio (1.61) which is comparable to the rest of the industry.
A Quick Ratio of 1.58 indicates that PSTG should not have too much problems paying its short term obligations.
Looking at the Quick ratio, with a value of 1.58, PSTG is in the better half of the industry, outperforming 68.75% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 1.61 | ||
| Quick Ratio | 1.58 |
3. Growth
3.1 Past
The Earnings Per Share has been growing slightly by 1.20% over the past year.
The Earnings Per Share has been growing by 45.75% on average over the past years. This is a very strong growth
Looking at the last year, PSTG shows a quite strong growth in Revenue. The Revenue has grown by 10.85% in the last year.
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)1.2%
EPS 3Y33.42%
EPS 5Y45.75%
EPS Q2Q%-9.38%
Revenue 1Y (TTM)10.85%
Revenue growth 3Y13.26%
Revenue growth 5Y14.03%
Sales Q2Q%12.26%
3.2 Future
Based on estimates for the next years, PSTG will show a quite strong growth in Earnings Per Share. The EPS will grow by 11.47% on average per year.
PSTG is expected to show quite a strong growth in Revenue. In the coming years, the Revenue will grow by 14.32% yearly.
EPS Next Y8.19%
EPS Next 2Y16.42%
EPS Next 3Y11.47%
EPS Next 5YN/A
Revenue Next Year11.49%
Revenue Next 2Y12.58%
Revenue Next 3Y11.09%
Revenue Next 5Y14.32%
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
A Price/Earnings ratio of 34.89 indicates a quite expensive valuation of PSTG.
PSTG's Price/Earnings is on the same level as the industry average.
When comparing the Price/Earnings ratio of PSTG to the average of the S&P500 Index (26.87), we can say PSTG is valued slightly more expensively.
A Price/Forward Earnings ratio of 25.29 indicates a quite expensive valuation of PSTG.
The rest of the industry has a similar Price/Forward Earnings ratio as PSTG.
The average S&P500 Price/Forward Earnings ratio is at 35.34. PSTG is valued slightly cheaper when compared to this.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 34.89 | ||
| Fwd PE | 25.29 |
4.2 Price Multiples
PSTG's Enterprise Value to EBITDA ratio is in line with the industry average.
The rest of the industry has a similar Price/Free Cash Flow ratio as PSTG.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 33.86 | ||
| EV/EBITDA | 74.61 |
4.3 Compensation for Growth
The high PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates PSTG does not grow enough to justify the current Price/Earnings ratio.
PEG (NY)4.26
PEG (5Y)0.76
EPS Next 2Y16.42%
EPS Next 3Y11.47%
5. Dividend
5.1 Amount
PSTG does not give a dividend.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | N/A |
58.62
+0.77 (+1.33%)
Chartmill FA Rating
GICS SectorInformation Technology
GICS IndustryGroupTechnology Hardware & Equipment
GICS IndustryTechnology Hardware, Storage & Peripherals
Earnings (Last)
Earnings (Next)
Inst Owners87.4%
Inst Owner Change0.17%
Ins Owners5.35%
Ins Owner Change4.58%
Market Cap19.16B
Analysts79.29
Price Target71.05 (21.2%)
Short Float %3.87%
Short Ratio4.39
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)10.64%
Min EPS beat(2)6.36%
Max EPS beat(2)14.91%
EPS beat(4)4
Avg EPS beat(4)13.81%
Min EPS beat(4)6.36%
Max EPS beat(4)17.38%
EPS beat(8)8
Avg EPS beat(8)19.68%
EPS beat(12)12
Avg EPS beat(12)30.39%
EPS beat(16)16
Avg EPS beat(16)68.71%
Revenue beat(2)0
Avg Revenue beat(2)-0.82%
Min Revenue beat(2)-0.91%
Max Revenue beat(2)-0.73%
Revenue beat(4)0
Avg Revenue beat(4)-0.62%
Min Revenue beat(4)-0.91%
Max Revenue beat(4)-0.01%
Revenue beat(8)0
Avg Revenue beat(8)-0.8%
Revenue beat(12)1
Avg Revenue beat(12)-0.55%
Revenue beat(16)5
Avg Revenue beat(16)1.74%
PT rev (1m)0%
PT rev (3m)0.73%
EPS NQ rev (1m)0%
EPS NQ rev (3m)0.69%
EPS NY rev (1m)0%
EPS NY rev (3m)6.73%
Revenue NQ rev (1m)0%
Revenue NQ rev (3m)0.53%
Revenue NY rev (1m)0%
Revenue NY rev (3m)0.39%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 34.89 | ||
| Fwd PE | 25.29 | ||
| P/S | 5.89 | ||
| P/FCF | 33.86 | ||
| P/OCF | 23.48 | ||
| P/B | 15.4 | ||
| P/tB | 22.08 | ||
| EV/EBITDA | 74.61 |
EPS(TTM)1.68
EY2.87%
EPS(NY)2.32
Fwd EY3.95%
FCF(TTM)1.73
FCFY2.95%
OCF(TTM)2.5
OCFY4.26%
SpS9.95
BVpS3.81
TBVpS2.65
PEG (NY)4.26
PEG (5Y)0.76
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 3.35% | ||
| ROE | 10.27% | ||
| ROCE | 4.14% | ||
| ROIC | 2.9% | ||
| ROICexc | 9.1% | ||
| ROICexgc | 18.61% | ||
| OM | 2.95% | ||
| PM (TTM) | 3.93% | ||
| GM | 69.26% | ||
| FCFM | 17.39% |
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 Turnover0.85
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0 | ||
| Debt/FCF | 0.18 | ||
| Debt/EBITDA | 0 | ||
| Cap/Depr | 197.86% | ||
| Cap/Sales | 7.69% | ||
| Interest Coverage | 13.96 | ||
| Cash Conversion | 367.02% | ||
| Profit Quality | 442.87% | ||
| Current Ratio | 1.61 | ||
| Quick Ratio | 1.58 | ||
| Altman-Z | 5.13 |
F-Score7
WACC8.95%
ROIC/WACC0.32
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)1.2%
EPS 3Y33.42%
EPS 5Y45.75%
EPS Q2Q%-9.38%
EPS Next Y8.19%
EPS Next 2Y16.42%
EPS Next 3Y11.47%
EPS Next 5YN/A
Revenue 1Y (TTM)10.85%
Revenue growth 3Y13.26%
Revenue growth 5Y14.03%
Sales Q2Q%12.26%
Revenue Next Year11.49%
Revenue Next 2Y12.58%
Revenue Next 3Y11.09%
Revenue Next 5Y14.32%
EBIT growth 1Y-27.98%
EBIT growth 3YN/A
EBIT growth 5YN/A
EBIT Next Year35.04%
EBIT Next 3Y24.91%
EBIT Next 5YN/A
FCF growth 1Y4.08%
FCF growth 3Y19.62%
FCF growth 5Y41.52%
OCF growth 1Y13.28%
OCF growth 3Y22.49%
OCF growth 5Y31.78%