Pure Storage Stock To $48?

Pure Storage (PSTG) stock has fallen 27% during the past day, and is currently trading at $68.85. Our multi-factor assessment suggests that it may be time to sell PSTG stock. We have, overall, a pessimistic view of the stock, and a price of $48 may not be out of reach. We believe there are only a couple of things to fear in PSTG stock given its overall Moderate operating performance and financial condition. But keeping in mind its High valuation, we think that the stock is Unattractive.

Below is our assessment:

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Let’s get into details of each of the assessed factors but before that, for quick background: With $23 Bil in market cap, Pure Storage provides data storage technologies and products, including FlashArray for block storage and FlashBlade for unstructured data workloads, serving both traditional and modern applications globally.

[1] Valuation Looks High

This table highlights how PSTG is valued vs broader market. For more details see: PSTG Valuation Ratios

[2] Growth Is Strong

• Pure Storage has seen its top line grow at an average rate of 9.7% over the last 3 years
• Its revenues have grown 11% from $3.0 Bil to $3.4 Bil in the last 12 months
• Also, its quarterly revenues grew 12.7% to $861 Mil in the most recent quarter from $764 Mil a year ago.

This table highlights how PSTG is growing vs broader market. For more details see: PSTG Revenue Comparison

[3] Profitability Appears Weak

• PSTG last 12 month operating income was $76 Mil representing operating margin of 2.3%
• With cash flow margin of 23.9%, it generated nearly $802 Mil in operating cash flow over this period
• For the same period, PSTG generated nearly $139 Mil in net income, suggesting net margin of about 4.2%

This table highlights how PSTG profitability vs broader market. For more details see: PSTG Operating Income Comparison

[4] Financial Stability Looks Very Strong

• PSTG Debt was $223 Mil at the end of the most recent quarter, while its current Market Cap is $23 Bil. This implies Debt-to-Equity Ratio of 1.2%
• PSTG Cash (including cash equivalents) makes up $1.5 Bil of $4.0 Bil in total Assets. This yields a Cash-to-Assets Ratio of 38.2%

[5] Downturn Resilience Is Weak

PSTG has fared worse than the S&P 500 index during various economic downturns. We assess this based on both (a) how much the stock fell and, (b) how quickly it recovered.

2022 Inflation Shock

• PSTG stock fell 41.1% from a high of $28.90 on 12 February 2021 to $17.03 on 12 May 2021 vs. a peak-to-trough decline of 25.4% for the S&P 500.
• However, the stock fully recovered to its pre-Crisis peak by 24 November 2021
• Since then, the stock increased to a high of $98.70 on 2 November 2025 , and currently trades at $68.85

 
2020 Covid Pandemic

• PSTG stock fell 55.6% from a high of $19.74 on 12 February 2020 to $8.76 on 18 March 2020 vs. a peak-to-trough decline of 33.9% for the S&P 500.
• However, the stock fully recovered to its pre-Crisis peak by 24 November 2020

But the risk is not limited to major market crashes. Stocks fall even when markets are good – think events like earnings, business updates, outlook changes. Read PSTG Dip Buyer Analyses to see how the stock has recovered from sharp dips in the past.

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