One Wall Street Analyst Has 22% Upside on Pure Storage Stock

One highly specialized technology stock that has attracted a lot of attention from investors recently is the aptly namedPure Storage (NYSE: PSTG)Pure Storage is a leader in this area. In a world of data overload, bigger, faster storage systems are more of a necessity than a necessity for many customers.Pure Storage is a leader in this area.

The company has also won the attention of analysts, often positively. Many are bullish on its future, including a forecaster at a major bank who recently labeled it a "buy."

Buy Recommendation

Mid-March.CitigroupAnalyst Asiya Merchant initiated the firm's research on Pure Storage. She put a buy tag on the company's stock and set a target price of $65 per share. At current prices, that implies an upside of 23% over the next 12 months or so.

"Pure's 100% product set, all of which utilize all-flash technology, is the fastest-growing segment of external storage," Merchant wrote in its first research report on the stock.

Artificial intelligence (AI) and machine learning (ML) capabilities "may further fuel the growth of flash storage service providers," she added. This is not only due to the increased space required to support this technology; flash storage, as the name suggests, also facilitates fast storage and retrieval.

However, growth is still to come ......

Merchant's positive assessment of Pure Storage is somewhat at odds with the company's recent statements.

The company is targeting double-digit growth in revenue and operating income. While this is undoubtedly encouraging, the company's shares are currently trading more like an explosive growth company than the relatively modest growth story it portrays for investors. As such, a $65 price target in 12 months might be a bit extravagant.

Should you invest $1,000 in Pure Storage now?

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Citigroup is an advertising name partner of The Ascent, a Motley Fool company. eric Volkman does not own any of the above stocks. the Motley Fool recommends Pure Storage. the Motley Fool has a disclosure policy.

A Wall Street Analyst Says Pure Storage Stock Has 22% of Upside was originally published by The Motley Fool.