Pure Storage (NYSE: PSTG) and Nimble Storage (NYSE:NMBL) are both computer and technology companies, but which is the superior investment? We will compare the two businesses based on the strength of their profitability, dividends, valuation, earnings, analyst recommendations, risk and institutional ownership.

Institutional & Insider Ownership

34.9% of Pure Storage shares are owned by institutional investors. Comparatively, 63.4% of Nimble Storage shares are owned by institutional investors. 46.6% of Pure Storage shares are owned by insiders. Comparatively, 20.9% of Nimble Storage shares are owned by insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a stock is poised for long-term growth.

Volatility & Risk

Pure Storage has a beta of 0.88, suggesting that its share price is 12% less volatile than the S&P 500. Comparatively, Nimble Storage has a beta of 1.78, suggesting that its share price is 78% more volatile than the S&P 500.

Profitability

This table compares Pure Storage and Nimble Storage’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Pure Storage -31.62% -44.04% -24.43%
Nimble Storage -31.11% -130.73% -44.52%

Earnings and Valuation

This table compares Pure Storage and Nimble Storage’s top-line revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio EBITDA Earnings Per Share Price/Earnings Ratio
Pure Storage $770.66 million 3.38 -$160.42 million ($1.22) -10.24
Nimble Storage N/A N/A N/A ($1.83) -6.83

Nimble Storage has higher revenue, but lower earnings than Pure Storage. Pure Storage is trading at a lower price-to-earnings ratio than Nimble Storage, indicating that it is currently the more affordable of the two stocks.

Analyst Recommendations

This is a breakdown of current ratings and recommmendations for Pure Storage and Nimble Storage, as provided by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Pure Storage 0 8 14 0 2.64
Nimble Storage 0 16 3 0 2.16

Pure Storage presently has a consensus target price of $15.43, indicating a potential upside of 23.50%. Nimble Storage has a consensus target price of $12.65, indicating a potential upside of 1.31%. Given Pure Storage’s stronger consensus rating and higher possible upside, analysts plainly believe Pure Storage is more favorable than Nimble Storage.

Summary

Pure Storage beats Nimble Storage on 8 of the 11 factors compared between the two stocks.

About Pure Storage

Pure Storage, Inc. provides a data platform. The Company is focused on delivering software-defined all-flash solutions that are fast and cloud-capable for customers, enabling customers to put data to work for their businesses. Its data platform replaces storage systems designed for mechanical disk with all-flash systems optimized end-to-end for solid-state memory. Its business model replaces the forklift upgrade cycle with an Evergreen Storage model. Its primary offerings include its FlashArray and FlashBlade products, inclusive of its Purity Operating Environment (Purity OE) software, its Pure1 cloud-based software, and FlashStack, its joint converged infrastructure solution with Cisco. Its customers include large and mid-size organizations across a diverse set of industry verticals, including cloud-based software and service providers, consumer Web, education, energy, financial services, governments, healthcare, manufacturing, media, retail and telecommunications.

About Nimble Storage

Nimble Storage, Inc. (Nimble Storage) focuses on providing its end-customers with data. The Company’s Predictive Cloud Platform combines predictive analytics, flash storage and multicloud infrastructure to manage operations in on-premises data centers and in the cloud. Its products allow end-customers to deploy workloads flexibly on flash arrays, converged infrastructure and the public cloud. Its operating system includes NimbleOS. NimbleOS runs across all of its All Flash and Adaptive Flash (Hybrid) arrays and powers Nimble Cloud Volumes. The features of NimbleOS include Cache Accelerated Sequential Layout (CASL), Variable Block Inline Deduplication, Variable Block Inline Compression, Efficient All Flash Array Architecture, Dynamic Caching for Adaptive Flash Arrays, Efficient, Instant Snapshots and Replication, SmartSecure Encryption and Data Shredding and Scalability.

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