Pure Storage Synopsis

Pure's stock had been trading negatively since their IPO in late 2015 and had traded to a low in February 2017. The stock had been trading/valued based on negative views on the company's ability to profitably scale while keeping their much larger and established competitors at bay. Consensus views were that Pure would eventually be beaten by the larger players from both a technology and go-to-market perspective. The stock was also heavily shorted with over 40% of shares shorted.

In order to better understand Pure's value proposition, we conducted the following investigative tasks:

• Held in-depth conversations with management and management of competing firms

• Interviewed researchers from Carnegie Mellon's Data Storage Software Center (an industry leading think-tank)

• Interviewed industry consultants

• Interviewed current engineers at Pure

• Interviewed former staff at competing firms

• Reviewed court records of EMC's lawsuit against Pure

The results of our research confirmed that Pure was disrupting the industry and legacy players were suffering revenue declines, because of the entrance of firms like Pure. After beating earnings every quarter since their IPO, Pure's stock finally was rewarded on on their Q1 2017 earnings release in May 2017 when the company beat earnings again. Since then the stock has been trading based on very positive sentiment.