On Friday, Citi Research analysts started coverage of Pure Storage (NYSE:PSTG) stock with a Buy rating and a price objective of $65.
The bullish move comes despite recent concerns over Meta Platforms (NASDAQ:META) shifting from PSTG’s externally sourced storage hardware to adopting an internally designed hardware approach.
“We believe shares have been impacted recently by a technical blog suggesting Meta is shifting away from external solutions (like Pure’s) that were incorporated in prior research clusters,” analysts said in the note.
“However, we believe Pure’s cost advantages (vs SSD and HDD offerings) and recent AI-related wins position it favorably,” they added.
With its portfolio entirely composed of all-flash technology, the data storage hardware maker operates within the fastest-growing niche of external storage.
The demand for AI and Machine Learning (ML) workloads is expected to boost this segment further, driven by the requirement for quick access and analysis of extensive volumes of unstructured data, analysts noted.