Shares of Pure Storage, Inc. (NYSE:PSTG) experienced a significant decline of 27.2% on Wednesday after Citigroup reduced its price target for the stock from $110.00 to $105.00. Despite this downgrade, Citigroup maintains a “buy” rating on the company. Following the announcement, Pure Storage shares traded as low as $68.34 before closing at $68.94, with approximately 21,365,759 shares exchanged during midday trading—an increase of 609% compared to the average daily volume of 3,014,156 shares.
The stock had previously closed at $94.72, highlighting a sharp shift in investor sentiment. Other analysts have also provided their insights on Pure Storage. On October 17, 2023, Raymond James Financial raised its target price from $88.00 to $99.00 and issued an “outperform” rating. Similarly, Susquehanna set a target price of $105.00, while Northland Securities established a target of $77.00.
In another bullish sign, Wells Fargo & Company increased their target price from $80.00 to $100.00 and rated the stock as “overweight” on September 26, 2023. Evercore ISI also raised its target, moving it from $90.00 to $105.00 and maintaining an “outperform” rating. Currently, thirteen research analysts have rated Pure Storage with a “buy,” seven have issued a “hold,” and one has given it a “sell” rating. According to data from MarketBeat.com, the stock has an average rating of “Moderate Buy” and a consensus target price of $93.16.
Institutional Trading and Investor Sentiment
Recent trading activity indicates a shift in institutional interest. Vanguard Group Inc. increased its stake in Pure Storage by 1.9% during the third quarter, acquiring an additional 623,019 shares. This brought its total holdings to 33,891,025 shares, valued at approximately $2.84 billion. State Street Corp also raised its position by 1.9%, now owning 10,864,918 shares worth about $910.59 million after acquiring an additional 199,831 shares.
Furthermore, T. Rowe Price Investment Management Inc. increased its holdings by 25.9%, now owning 9,075,944 shares valued at approximately $401.79 million. Geode Capital Management LLC raised its stake by 1.7%, reaching 7,273,696 shares valued at $417.83 million. Notably, William Blair Investment Management LLC significantly increased its stake by 112.9%, now holding 4,926,836 shares valued at around $283.69 million. Overall, institutional investors own approximately 83.42% of Pure Storage.
Company Performance and Outlook
The recent stock decline comes despite a solid performance report from Pure Storage, which announced its quarterly earnings on September 9, 2023. The company reported earnings per share of $0.44, with total revenue reaching $763.77 million for the quarter. Pure Storage recorded a return on equity of 11.34% and a net margin of 4.15%. Looking ahead, analysts project that Pure Storage will maintain an earnings per share of $0.44 for the current year.
Founded in the United States, Pure Storage specializes in data storage and management technologies, offering products and services both domestically and internationally. Its Purity software is a key component across its products, providing enterprise-class data services that include always-on data reduction, data protection, and encryption, along with various storage protocols.
The recent market activity and analyst ratings reflect both cautious optimism and significant volatility in Pure Storage’s stock, indicating that investors are closely monitoring the company’s performance and strategic direction in a competitive technology landscape.
