Contrasting Quantum (QMCO) & Pure Storage (PSTG)

Quantum (OTCMKTS:QMCO) and Pure Storage (NYSE:PSTG) are both computer and technology companies, but which is the superior investment? We will contrast the two businesses based on the strength of their earnings, profitability, analyst recommendations, valuation, institutional ownership, dividends and risk.

Risk and Volatility

Quantum has a beta of 2.11, indicating that its stock price is 111% more volatile than the S&P 500. Comparatively, Pure Storage has a beta of 1.66, indicating that its stock price is 66% more volatile than the S&P 500.

Profitability

This table compares Quantum and Pure Storage’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Quantum N/A N/A N/A
Pure Storage -12.89% -23.88% -9.67%

Valuation and Earnings

This table compares Quantum and Pure Storage’s top-line revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Quantum $505.35 million 0.17 $3.64 million N/A N/A
Pure Storage $1.02 billion 4.32 -$177.60 million ($0.84) -21.76

Quantum has higher earnings, but lower revenue than Pure Storage.

Analyst Recommendations

This is a summary of recent ratings and recommmendations for Quantum and Pure Storage, as provided by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Quantum 0 0 0 0 N/A
Pure Storage 0 7 17 0 2.71

Pure Storage has a consensus price target of $26.41, indicating a potential upside of 44.47%. Given Pure Storage’s higher probable upside, analysts clearly believe Pure Storage is more favorable than Quantum.

Insider & Institutional Ownership

52.0% of Quantum shares are held by institutional investors. Comparatively, 72.4% of Pure Storage shares are held by institutional investors. 8.6% of Quantum shares are held by company insiders. Comparatively, 15.3% of Pure Storage shares are held by company insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a stock will outperform the market over the long term.

Summary

Pure Storage beats Quantum on 6 of the 11 factors compared between the two stocks.

Quantum Company Profile

Quantum Corp. engages in the manufacture of computer storage device. It provides solutions for storing and protecting information in physical, virtual and cloud environments. The company was founded by Joel N. Harrison and James M. McCoy in 1980 and is headquartered in San Jose, CA.

Pure Storage Company Profile

Pure Storage, Inc. engages in building a data platform that enables businesses to enhance performance and reduce complexity and costs worldwide. The company delivers its data platform through Purity Operating Environment, an optimized software for solid-state memory that offers enterprise-class storage and protocol services; FlashArray and FlashBlade optimized hardware products for solid-state memory to enhance the performance and density of flash, optimize its advanced software services, and reduce solution cost for customers; Pure1, a cloud-based management and support software; and FlashStack, a converged infrastructure solution. Its data platform is used for a range of use cases, including database applications, large-scale analytics, private and public cloud infrastructure, Webscale applications, virtual server infrastructure, and virtual desktop infrastructure; and helps customers scale their businesses through real-time and accurate analytics, increase employee productivity, improve operational efficiency, and deliver compelling user experiences to their customers and partners. The company serves large and mid-size organizations across various industries, such as cloud-based software and service providers, consumer Web, education, energy, financial services, government, healthcare, manufacturing, media, retail, and telecommunications through a network of distribution and channel partners. The company was formerly known as OS76, Inc. and changed its name to Pure Storage, Inc. in January 2010. Pure Storage, Inc. was founded in 2009 and is headquartered in Mountain View, California.

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