Pure Storage (PSTG) Solid in Q2, FlashBlade Remains in Focus - Stifel
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Stifel affirms its Buy rating and $20 on Pure Storage (NYSE: PSTG) following the company's Q217 results issued Thursday night.
The firm commented,
Pure reported solid F2Q17 upside of $163.2M / ($0.16) vs. our $155.1M / ($0.23) estimate; Pure guided F2Q17 at $153-$157M w/ a -26% to -30% EBIT%. F3Q17 outlook at $187-$195M with a -13.5% to -17.5% EBIT% compares to our prior $191.8M / -14% estimate. We believe Pure’s constructive commentary on the new FlashBlade systems will leave investors to think about materializing upside potential through 2HF2017 and more notably F2018.
Pure has now beat our / street initial post-IPO revenue expectations by ~23% (+$108M), while impressively generating cumulative non-GAAP EBIT upside of ~$99M; Pure's cumulative opex has also been ~$11M lower than initial post-IPO estimates. At a sub-2x NTM EV/sales multiple, coupled with our increased belief that FlashBlade could become a significant incremental driver into C2017-beyond and Pure’s overall architectural decisions (e.g., NVMe w/ NVMe-over-Fabrics becoming an increasing focus), we believe a positive re-rate in shares should be considered.
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