Pure Storage (PSTG) shares closed greater than 30% larger on Thursday after the enterprise-grade information storage options firm reported a powerful Q2 and raised its steering for the total yr.
The corporate’s administration now expects income to fall between $3.6 billion and $3.63 billion in fiscal 2025 – properly forward of $3.52 billion it had forecast earlier.
Together with the post-earnings surge, Pure Storage inventory is buying and selling at greater than double its value within the first week of April.
PSTG inventory is now going for a very stretched ahead price-earnings (P/E) a number of of 107x.
Nonetheless, valuation should not be a significant concern for Pure Storage given “this market is hooked on simple cash,” stated Dan Niles, a famend portfolio supervisor in a CNBC interview in the present day.
Within the present surroundings, he added, “you’re paid to take dangers.”
On Thursday, Fundstrat’s high strategist Tom Lee additionally revealed the momentum commerce isn’t exhibiting any indicators of fading, at the least anytime quickly.
His remarks additional substantiate that buyers shouldn’t be overly involved about Pure Storage’s valuation, particularly after the corporate recorded a blockbuster quarter and raised its steering for the long run.
Pure Storage shares stay enticing additionally as a result of they provide a method of “enjoying into the synthetic intelligence surroundings in a number of methods,” in accordance with the corporate’s chief govt Charles Giancarlo.
In a post-earnings interview, Giancarlo stated an AI surroundings is all about “efficiency,” touting his firm’s “FlashBlade Exa,” whose industry-leading benchmarks proceed to draw huge demand.
PSTG is the first storage provider for Meta Platforms (META). On Thursday, the NYSE-listed agency stated it’s on observe to deploy as a lot as 2 exabyte of capability with the tech titan by year-end.
That made UBS analysts enhance their value goal on PSTG shares in the present day to $85, indicating potential for one more 6% upside from right here.
Wall Avenue at present has a consensus “Average Purchase” ranking on Pure Storage shares.
