Pure Storage stock price target raised to $85 from $80 at TD Cowen

Investing.com - TD Cowen raised its price target on Pure Storage (NYSE:PSTG) to $85.00 from $80.00 on Thursday, while maintaining a Buy rating on the data storage company’s stock. The company, currently valued at $24.62 billion, has seen its shares surge over 9% in the past week, with analysts setting targets ranging from $50 to $93. According to InvestingPro analysis, Pure Storage appears overvalued at current levels, trading at a P/E ratio of 155x.

The firm noted that Pure Storage has begun generating an "immaterial amount of revenues" from Meta for 1-2 exabytes of storage deployments, with royalty revenues at more than 90% margins included as part of product revenue.

Pure Storage reiterated its calendar year 2026 guidance of double-digit exabytes, though the company did not provide further details as the solution remains in the pilot stage, which TD Cowen believes is the final stage before volume production.

The research firm indicated that the revenue opportunity from Meta remains difficult to forecast, and maintained its $100 million revenue estimate from the initial deal with the social media giant.

TD Cowen also highlighted that since Pure Storage first discussed the "double-digit exabyte" opportunity with Meta, consensus capital expenditure estimates for Meta have increased from $60 billion to $90 billion for calendar year 2026.

In other recent news, Pure Storage has reported strong financial performance, exceeding expectations in its second-quarter fiscal 2026 results. The company achieved revenue of $861 million and earnings per share of $0.43, surpassing analyst estimates of $846 million in revenue and $0.39 in earnings per share. Pure Storage’s quarterly revenue growth reached approximately 12.7%, with notable increases in both product and services/software segments. Following these results, several analyst firms have adjusted their price targets for the company. Lake Street Capital Markets raised its target to $80, while maintaining a Buy rating, citing continued revenue acceleration and improved product gross margins. Raymond James also increased its price target to $88, highlighting the company’s "beat and raise report" amid cautious sentiment. Needham raised its target to $85, pointing to strong growth in Remaining Performance Obligation as a positive indicator. BofA Securities adjusted its target to $80, maintaining a Neutral rating, acknowledging the company’s improved operating margins. Evercore ISI also raised its target to $80, following the better-than-expected quarterly results.

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