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 has an excellent financial health rating, but there are some minor concerns on its profitability. PSTG is valued quite expensively, but it does show have an excellent growth rating. This makes PSTG very considerable for growth investing!
1. Profitability
1.1 Basic Checks
In the past year PSTG was profitable.
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.
In the past 5 years PSTG always reported a positive cash flow from operatings.
1.2 Ratios
The Return On Assets of PSTG (2.69%) is better than 62.50% of its industry peers.
PSTG's Return On Equity of 8.17% is fine compared to the rest of the industry. PSTG outperforms 75.00% of its industry peers.
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.
Measured over the past 3 years, the Average Return On Invested Capital for PSTG is significantly below the industry average of 16.87%.
The 3 year average ROIC (2.97%) for PSTG is below the current ROIC(2.99%), indicating increased profibility in the last year.
| 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 59.38% of the companies in the same industry.
The Operating Margin of PSTG (3.19%) is comparable to the rest of the industry.
The Gross Margin of PSTG (69.84%) 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 | 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
The Return on Invested Capital (ROIC) is below the Cost of Capital (WACC), so 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 4.84 indicates that PSTG is not in any danger for bankruptcy at the moment.
PSTG has a Altman-Z score of 4.84. This is amongst the best in the industry. PSTG outperforms 87.50% of its industry peers.
PSTG has no outstanding debt. Therefor its Debt/Equity and Debt/FCF ratios are 0 and belong to the best of the industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0 | ||
| Debt/FCF | 0.19 | ||
| Altman-Z | 4.84 |
ROIC/WACC0.33
WACC9.08%
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 59.38% of its industry peers.
A Quick Ratio of 1.58 indicates that PSTG should not have too much problems paying its short term obligations.
PSTG has a Quick ratio of 1.58. This is in the better half of the industry: PSTG outperforms 71.88% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 1.61 | ||
| Quick Ratio | 1.58 |
3. Growth
3.1 Past
PSTG shows a strong growth in Earnings Per Share. In the last year, the EPS has been growing by 20.42%, which is quite impressive.
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.
Looking at the last year, PSTG shows a quite strong growth in Revenue. The Revenue has grown by 11.92% 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)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 12.79% on average over the next years. This is quite good.
Based on estimates for the next years, PSTG will show a quite strong growth in Revenue. The Revenue will grow by 14.35% on average per year.
EPS Next Y1.9%
EPS Next 2Y13.62%
EPS Next 3Y12.79%
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.
The Revenue growth rate is stable: in the next years the growth will be about the same than in the last years.
4. Valuation
4.1 Price/Earnings Ratio
A Price/Earnings ratio of 33.06 indicates a quite expensive valuation of PSTG.
PSTG's Price/Earnings is on the same level as the industry average.
Compared to an average S&P500 Price/Earnings ratio of 26.60, PSTG is valued a bit more expensive.
A Price/Forward Earnings ratio of 32.45 indicates a quite expensive valuation of PSTG.
62.50% of the companies in the same industry are cheaper than PSTG, based on the Price/Forward Earnings ratio.
PSTG is valuated rather expensively when we compare the Price/Forward Earnings ratio to 22.43, which is the current average of the S&P500 Index.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 33.06 | ||
| Fwd PE | 32.45 |
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 is on the same level as its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 34.99 | ||
| EV/EBITDA | 70.78 |
4.3 Compensation for Growth
The high PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates an expensive valuation of the company.
PSTG's earnings are expected to grow with 12.79% in the coming years. This may justify a more expensive valuation.
PEG (NY)17.36
PEG (5Y)0.72
EPS Next 2Y13.62%
EPS Next 3Y12.79%
5. Dividend
5.1 Amount
PSTG does not give a dividend.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | N/A |
56.54
+0.27 (+0.48%)
Chartmill FA Rating
GICS SectorInformation Technology
GICS IndustryGroupTechnology Hardware & Equipment
GICS IndustryTechnology Hardware, Storage & Peripherals
Earnings (Last)
Earnings (Next)
Inst Owners86.02%
Inst Owner Change2.67%
Ins Owners4.88%
Ins Owner Change-7.06%
Market Cap18.43B
Analysts80
Price Target69.77 (23.4%)
Short Float %3.76%
Short Ratio3.9
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)-4.2%
PT rev (3m)-4.49%
EPS NQ rev (1m)0%
EPS NQ rev (3m)-16.51%
EPS NY rev (1m)0.53%
EPS NY rev (3m)-3.31%
Revenue NQ rev (1m)0%
Revenue NQ rev (3m)0.23%
Revenue NY rev (1m)-0.22%
Revenue NY rev (3m)-0.42%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 33.06 | ||
| Fwd PE | 32.45 | ||
| P/S | 5.82 | ||
| P/FCF | 34.99 | ||
| P/OCF | 24.46 | ||
| P/B | 14.11 | ||
| P/tB | 19.91 | ||
| EV/EBITDA | 70.78 |
EPS(TTM)1.71
EY3.02%
EPS(NY)1.74
Fwd EY3.08%
FCF(TTM)1.62
FCFY2.86%
OCF(TTM)2.31
OCFY4.09%
SpS9.72
BVpS4.01
TBVpS2.84
PEG (NY)17.36
PEG (5Y)0.72
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 | 4.84 |
F-Score7
WACC9.08%
ROIC/WACC0.33
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 Y1.9%
EPS Next 2Y13.62%
EPS Next 3Y12.79%
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%