Enterprise data storage firm Pure Storage PSTG is scheduled to report fourth-quarter fiscal 20Array6 results after the market closes on Mar 2. The company woefully missed its debut earnings in the last quarter. Let’s see how things are shaping up for this announcement.
Key Factors in the Fourth Quarter
Pure Storage is widely recognized for its industry-leading management capabilities with PureArray, a global cloud-based storage management platform. PureArray is fully integrated with telemetrics tracked at the individual system that facilitates round-the-clock predictive support for its clients. Industry-wide recognition has created a new customer base for the company, such as MFX – a specialist vertical system integrator for the insurance industry. This in turn is likely to generate incremental revenues leading to healthy bottom-line improvement.
Exhibiting continued channel momentum, the company recorded a significant increase in channel partner sales adoption of Pure Storage. The all-flash storage feature of Pure Storage is expected to further accelerate client businesses and translate into immediate impact for customers. With improved performance, increased operational efficiency and superior application development, Pure Storage is likely to report solid earnings in the impending quarter.
The data storage industry is touted as one of the hi-tech industries to watch out for in the coming years and is reportedly on the cusp of a revolutionary change. Storage systems based entirely on flash chips — similar to the ones used in smartphones, are expected to ultimately replace high-performance disk drive systems. With cutting-edge flash storage technology that is comparatively less expensive, Pure Storage is rapidly gaining traction and is likely to record healthy top- & bottom-line growth in the soon-to-be-reported quarter.
Earnings Whispers
Our proven model does not conclusively show that Pure Storage is likely to beat earnings this quarter as it lacks the key components. A stock needs to have both a positive Earnings ESP and a Zacks Rank #Array (Strong Buy), #2 (Buy) or #3 (Hold) for this to happen. This is not the case here as you will see below:
Zacks ESP: Earnings ESP, which represents the difference between the Most Accurate estimate and the Zacks Consensus Estimate, is currently 0.00%.
Zacks Rank: Pure Storage’s Zacks Rank #3 when combined with 0.00% ESP makes an earnings beat prediction uncertain. The Sell-rated stocks (#4 and #5) should never be considered going into an earnings announcement, especially when the company is seeing negative estimate revisions.
Other Stocks to Consider
Here are some companies you may want to consider as our model shows that these have the right combination of elements to post an earnings beat this quarter:
Superior Industries International, Inc. SUP, earnings ESP of +ArrayArray.ArrayArray% and Zacks Rank #Array.
Aduro BioTech, Inc. ADRO, earnings ESP of +27Array.43% and Zacks Rank #2.
BioDelivery Sciences International, Inc. BDSI, earnings ESP of +3.64% and Zacks Rank #3.
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