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What's in the Cards for Pure Storage (PSTG) in Q4 Earnings?
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Pure Storage Inc. (PSTG - Free Report) is set to release its fourth-quarter fiscal 2017 earnings on Mar 1. In the last quarter, the company reported a positive earnings surprise of 20.00%. We note that the company has delivered positive surprises in three of the last four quarters resulting in an average positive surprise of 6.45%.
The company reported non-GAAP net loss of 24 cents per share in third-quarter fiscal 2017 that was narrower than the Zacks Consensus Estimate of a loss of 30 cents.
However, improving results failed to provide significant momentum to the share price. We note that Pure Storage has underperformed the Zacks Computer- Storage Devices industry over the last one year. While the industry gained 51.6%, the stock declined 19.7% over the same period.
Let’s see how things are shaping up for this announcement.
Factors to Consider
During the fourth quarter, the company released the FlashBlade in both 8.8TB and 52TB blade capacities, which is in great demand by scientists, developers and modern engineers.
Also, the company’s FlashArray line of products continued to gain substantial traction in both the local and state level data center environments.
Moreover, Pure Storage introduced the concept of NVMe-ready guarantee wherein every customer purchasing its FlashArray//M gets automatically entitled to upgrade to the full NVMe through the company’s Evergreen Storage program.
While these developments remain positives for the company and the impact is likely to be reflected in its bottom line numbers in the soon-to-be reported quarter, a competitive landscape with the presence of major storage players such as Seagate (STX - Free Report) remains a concern for the company.
Our proven model does not conclusively show that Pure Storage is likely to beat earnings this quarter. This is because a stock needs to have both a positive Earnings ESPand a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) for this to happen. That is not the case here, as you will see below.
Zacks ESP: Pure Storage’s Earnings ESP is 0.00%. This is because both the Most Accurate estimate and the Zacks Consensus Estimate are pegged at a loss of 24 cents per share. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.
Zacks Rank: Pure Storage carries a Zacks Rank #2, which when combined with a 0.00% ESP makes surprise prediction difficult.
We caution against stocks with a Zacks Rank #4 and 5 (Sell rated) going into the earnings announcement, especially when the company is seeing negative estimate revisions.
Stocks to Consider
Here are some companies that, as per our model, have the right combination of elements to post an earnings beat this quarter:
Momo Inc. (MOMO - Free Report) with an Earnings ESP of +3.23% and a Zacks Rank #3.
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What's in the Cards for Pure Storage (PSTG) in Q4 Earnings?
Pure Storage Inc. (PSTG - Free Report) is set to release its fourth-quarter fiscal 2017 earnings on Mar 1. In the last quarter, the company reported a positive earnings surprise of 20.00%. We note that the company has delivered positive surprises in three of the last four quarters resulting in an average positive surprise of 6.45%.
The company reported non-GAAP net loss of 24 cents per share in third-quarter fiscal 2017 that was narrower than the Zacks Consensus Estimate of a loss of 30 cents.
However, improving results failed to provide significant momentum to the share price. We note that Pure Storage has underperformed the Zacks Computer- Storage Devices industry over the last one year. While the industry gained 51.6%, the stock declined 19.7% over the same period.
Let’s see how things are shaping up for this announcement.
Factors to Consider
During the fourth quarter, the company released the FlashBlade in both 8.8TB and 52TB blade capacities, which is in great demand by scientists, developers and modern engineers.
Also, the company’s FlashArray line of products continued to gain substantial traction in both the local and state level data center environments.
Moreover, Pure Storage introduced the concept of NVMe-ready guarantee wherein every customer purchasing its FlashArray//M gets automatically entitled to upgrade to the full NVMe through the company’s Evergreen Storage program.
While these developments remain positives for the company and the impact is likely to be reflected in its bottom line numbers in the soon-to-be reported quarter, a competitive landscape with the presence of major storage players such as Seagate (STX - Free Report) remains a concern for the company.
Pure Storage, Inc. Price and EPS Surprise
Pure Storage, Inc. Price and EPS Surprise | Pure Storage, Inc. Quote
Earnings Whispers?
Our proven model does not conclusively show that Pure Storage is likely to beat earnings this quarter. This is because a stock needs to have both a positive Earnings ESPand a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) for this to happen. That is not the case here, as you will see below.
Zacks ESP: Pure Storage’s Earnings ESP is 0.00%. This is because both the Most Accurate estimate and the Zacks Consensus Estimate are pegged at a loss of 24 cents per share. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.
Zacks Rank: Pure Storage carries a Zacks Rank #2, which when combined with a 0.00% ESP makes surprise prediction difficult.
We caution against stocks with a Zacks Rank #4 and 5 (Sell rated) going into the earnings announcement, especially when the company is seeing negative estimate revisions.
Stocks to Consider
Here are some companies that, as per our model, have the right combination of elements to post an earnings beat this quarter:
Broadcom Limited (AVGO - Free Report) with anESP of +0.66% and a Zacks Rank #3. You can see the complete list of today’s Zacks #1 Rank stocks here.
Momo Inc. (MOMO - Free Report) with an Earnings ESP of +3.23% and a Zacks Rank #3.
A Full-Blown Technological Breakthrough in the Making
Zacks’ Aggressive Growth Strategist Brian Bolan explores autonomous cars in our latest Special Report, Driverless Cars: Your Roadmap to Mega-Profits Today. In addition to who will be selling them and how the auto industry will be impacted, Brian reveals 8 stocks with tremendous gain potential to feed off this phenomenon. Click to see the stocks right now >>