Why Pure Storage, Inc. (PSTG) Went Down on Thursday

We recently compiled a list of the 10 Stocks Drop by Double Digits Mostly Due to Disappointing Earnings. In this article, we are going to take a look at where Pure Storage, Inc. (NYSE:PSTG) stands against the other stocks.

Wall Street’s main indices suffered a bloodbath on Thursday as overall investor sentiment was weighed down by President Donald Trump’s series of tariffs on goods from other countries.

The Dow Jones dropped by 0.45 percent, while the S&P declined 1.59 percent. Nasdaq, on the other hand, lost 2.78 percent.

On Thursday, Trump threatened to slap EU products with a 25-percent tax, following his announcement on Wednesday of another month of delay for the imposition of taxes on goods from Mexico and Canada.

Ten companies also mirrored wider market pessimism, posting double-digit declines, albeit the drop was predominantly due to dismal earnings performance last year.

To come up with Thursday’s worst performers, we considered only the stocks with $2 billion in market capitalization and $5 million in daily trading volume.

A closeup of a computer monitor displaying a complex software interface used in data protection services.

Pure Storage, Inc. (NYSE:PSTG)

Pure Storage, Inc. (NYSE:PSTG) fell by 14.8 percent on Thursday to end at $53.20 apiece as investors sold off on the company’s disappointing earnings performance last year, shunning its optimistic outlook for this year.

In a statement, Pure Storage, Inc. (NYSE:PSTG) said net income in the fourth quarter dropped by 35 percent to $42.4 million from $65.4 million, despite revenues growing by 11 percent to $879.8 million from $789.8 million.

Meanwhile, net income during the full year increased by 75 percent to $106.7 million from $61 million a year earlier. Revenues also grew by 12 percent to $3.168 billion from $2.83 billion year-on-year.

For the next quarter, Pure Storage, Inc. (NYSE:PSTG) expects revenues to settle at $770 million or a growth rate of 11 percent year-on-year, while revenues for the next full year were pegged at $3.5 billion or an 11 percent increase from last year.

Overall PSTG ranks 7th on our list of Thursday’s worst performers. While we acknowledge the potential of PSTG as an investment, our conviction lies in the belief that some AI stocks hold greater promise for delivering higher returns and doing so within a shorter time frame. If you are looking for an AI stock that is as promising as PSTG but trades at less than 5 times its earnings, check out our report about the cheapest AI stock.

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Disclosure: None. This article is originally published at Insider Monkey.