Pure Storage has a powerful long-term development outlook, in keeping with Guggenheim Securities. The funding agency initiated protection of the software program storage firm with a purchase score on Thursday. Guggenheim’s value goal of $48 signifies a possible upside of about 50% from the inventory’s closing value of $31.81 on Wednesday. The consensus value goal amongst analysts surveyed by FactSet is $42. Shares of Pure Storage are up greater than 19% up to now this 12 months, matching the S&P 500. PSTG analysts because the starting of the 12 months, led by Howard Ma, have praised Pure Storage for its improvements, calling it a “disruptor within the enterprise storage market.” “Its core strategy of designing all-flash storage techniques utilizing proprietary software program that natively controls NAND flash has resulted in what most IT patrons think about nirvana — higher efficiency at a decrease price,” Ma wrote in an 87-page report. It allowed it to double its income share within the core storage market to 10% in simply 5 years. Ma believes the corporate may ultimately obtain a 20% and even 50% market share, which he stated would correspond to “$10 billion or 3.5 occasions “Incremental revenues.” The analyst sees extra alternatives for Pure Storage within the secondary storage market, the place he estimates that about 40% of the market – a $3 billion alternative – is now up for grabs. Nevertheless, this can depend upon the corporate lowering its common Promoting value considerably. “Given our evaluation of NAND flash costs, we wrestle to see how Pure may decrease its ASP to $0.05/GB, which might give it a chance to promote on to AWS, Azure, or Google. Nevertheless, it’s attainable, contemplating that this group continues to push the boundaries,” Ma wrote. Nevertheless, Guggenheim famous that Pure Storage’s final success doesn’t depend upon these “extra alternatives.” It’s because he believes the corporate can It’s at some point valued as a software program firm attributable to its massive, secure income stream, which might considerably increase its inventory value. Pure Storage shares are presently comparatively undervalued in comparison with their software program friends, reflecting solely “modest incremental traction” inside the storage market Important. — CNBC’s Michael Bloom contributed to this report.