Distributed storage company Pure Storage (NYSE:PSTG) has been on quite the rollercoaster ride over the past year. Indeed, shares of PSTG stock have whipsawed back and forth on a number of rallies.
One of the overlooked stocks that got caught up in the meme stock rally of January/February 2021, PSTG stock nearly doubled from around $15 per share late last year to a high of nearly $30 per share in Q1. However, since then, shares have cooled off to around the $20 level.
Today, shares of PSTG stock are currently trading around $24 per share. This represents an increase of approximately 15% over yesterday’s close. Today’s move appears to be the result of a couple of key catalysts investors are jumping on today.
Let’s dive into what’s behind today’s outsized rally in Pure Storage.
PSTG Stock Soaring Following Earnings
Yesterday, Pure Storage reported strong earnings, which has been the primary driver of today’s price action in PSTG stock. The company reported revenue growth of 23% to $497 million this past quarter. This beat analyst expectations by more than 5%. Accordingly, investors appear to be pricing in stronger growth moving forward than previously expected.
Across the company’s commercial and enterprise businesses, the company saw stronger-than-expected growth. As the economy continues to recover from the pandemic, it’s expected distributed storage companies will outperform. This is a stock that represents one of the pandemic reopening plays many investors have on their radar right now.
Additionally, the other catalyst investors are looking at with PSTG stock is the company’s relatively strong forward guidance it put forth during its earnings call. The company projected fiscal Q3 revenues of $530 million, which would represent quarter-over-quarter growth of nearly 7%.
Indeed, any time a company like Pure Storage can keep moving the dial, growth investors are likely to jump aboard. This is a stock that has shown the ability to generate significant momentum in the past. Accordingly, retail investors are jumping on these earnings in a big way today.
On the date of publication, Chris MacDonald did not have (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.