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Price: $106.50
Discount category: Far above intrinsic value
Intrinsic value source: AI estimate
Next earnings: Dec 1, 2026
Next earnings is estimate: Yes
Company name: added: Everpure
Sector: added: Data storage and data management
About: added: Everpure, Inc. (Everpure) was called Pure Storage until February 2026. It is based in Santa Clara, California. It sells data storage systems and the software that runs them, and a platform for data management. Product revenue comes from FlashArray and FlashBlade systems, royalties from hyperscaler shipments, and Portworx software licenses. Subscription services revenue comes from Evergreen, Portworx and Everpure Cloud subscriptions, support and professional services. In the first two quarters of fiscal 2027, revenue was $2,238.8 million, of which product revenue was $1,263.3 million and subscription services revenue was $975.5 million. Subscription annual recurring revenue was $2.1 billion at the end of Q2. Charles Giancarlo is Chairman and Chief Executive Officer, and Tarek Robbiati is Chief Financial Officer. The Class A common shares trade on the New York Stock Exchange in US dollars.
Thesis: added: The market prices Everpure above the AI estimate, because investors pay for revenue growth near 40% while flash memory costs rise, before profit after share-based pay grows with it. In Q2 of fiscal 2027, revenue rose 38% to $1.19 billion and product revenue rose 54%. The company says that higher prices helped, and that demand stayed strong despite historic industry price increases. Non-GAAP operating margin was 19.4%, but share-based pay was 13.5% of revenue, so GAAP operating margin was only 5.3%. The company raised its guidance for fiscal 2027 to revenue of $5.03 billion to $5.07 billion. For the price to be earned, three things must be true. Hyperscaler design wins, including two with top-five hyperscalers, must turn into steady royalties and shipments. Demand must stay strong, and component costs must not squeeze gross margin, which was 68.4% on a GAAP basis in Q2. Share-based pay must fall as a share of revenue. The next tests are the Q3 report in early December 2026 and the Q4 report with the plan for fiscal 2028 in early 2027. If growth slows or component costs squeeze gross margin, the price can fall toward the AI estimate.
Valuation: added: The intrinsic value for Everpure is an AI estimate from November 12, 2026. It is not an analyst's value. An AI research agent calculated it from the filings of Everpure with the SEC. Everpure was called Pure Storage until February 2026. The method is a multiple of earnings per share for fiscal 2028, which is the year that ends in early 2028, plus cash. The earnings are built from revenue, the non-GAAP operating margin of the company less share-based pay as a cost, a tax rate and a share count. The estimate treats share-based pay as a real cost, so it is not the non-GAAP measure of the company. The Q2 fiscal 2027 release (8-K, August 26, 2026) gives revenue of $1,185.9 million, non-GAAP operating income of $229.6 million (19.4% of revenue) and share-based pay of $159.8 million (13.5% of revenue) for Q2, and share-based pay of $281.9 million for two quarters. It gives guidance for fiscal 2027 of revenue of $5.03 billion to $5.07 billion and non-GAAP operating income of $940 million to $960 million. The Form 10-Q for the quarter ended August 2, 2026 gives 333,227,251 Class A shares outstanding at August 31, 2026, weighted average basic shares of 332.942 million and diluted shares of 345.587 million for Q2, cash and cash equivalents of $385.7 million, marketable securities of $622.2 million and no borrowings. The estimate adds the dilution of 12.645 million shares to the shares outstanding, for 345.87 million shares, and adds cash and securities of $1,007.9 million, which is $2.91 per share. It leaves the revolving credit facility, the supply commitment of about $1.1 billion and the lease liabilities out of the calculation. The revenue for fiscal 2028, the margins, the share-based pay, the tax rate of 15% and the multiples are assumptions. The low case assumes revenue of $5,600 million, because orders slow after the price rises, a non-GAAP operating margin of 17.5% and share-based pay of 12.5% of revenue. EPS is $0.69. At 25 times it gives $17.20, and with cash it gives $20.12 per share. The base case assumes revenue of $6,350 million, which is 26% above the middle of the guidance for fiscal 2027, a non-GAAP operating margin of 20.0% and share-based pay of 11.5% of revenue. EPS is $1.33. At 35 times it gives $46.43, and with cash it gives $49.34 per share. The high case assumes revenue of $7,100 million, because hyperscaler shipments grow fast, a non-GAAP operating margin of 22.5% and share-based pay of 11.0% of revenue. EPS is $2.01. At 45 times it gives $90.30, and with cash it gives $93.21 per share. The estimate assumes weights of 25%, 50% and 25%. The weighted intrinsic value is $53.00 per share. As of Nov 12, 2026.
Risks: added: Component costs and supply can hurt margin and cash. Component prices rose, and Everpure must buy about $1.1 billion of components through 2027 under one arrangement. Operating cash flow was only $43.8 million in two quarters, against $496.1 million a year before. Demand can slow when price rises end. The company says that higher prices and demand from large enterprises drove product growth. Orders from a few very large hyperscalers also can change quickly in size and timing. Share-based pay is a large cost. It was $159.8 million in Q2, which is 13.5% of revenue, and the company excludes it from non-GAAP results. The company spent $175.3 million in two quarters to pay tax on vested awards. The stock must keep up with high growth. Revenue growth was 38% in Q2, and the guidance for Q3 is 37% to 38%. Any slowing can lead to a large change in the price. Acquisitions can fail to add value. Everpure bought 1touch for $125.9 million in May 2026, and its goodwill rose to $466.3 million.
Balance sheet: added: At August 2, 2026, Everpure had cash and cash equivalents of $385.7 million and marketable securities of $622.2 million, which is $1,007.9 million, and no debt. At February 1, 2026, it had $854.9 million of cash and $692.4 million of securities. It has a $500.0 million revolving credit facility that ends on June 10, 2030, with no borrowings and $4.9 million of letters of credit under it. Deferred revenue was $2,521.3 million. Operating cash flow was $43.8 million for two quarters, and free cash flow was negative $238 million in Q2. The company has $176.0 million left of its $1.8 billion buyback authority. As of Aug 2, 2026.
Checkpoints: added: Dec 1, 2026 (estimate): Q3 fiscal 2027 results: revenue and margin. Pending. Watch: Revenue lands in the guided range of $1.325 billion to $1.335 billion and non-GAAP operating income reaches $265 million to $275 million, and this passes; lower revenue or a falling gross margin fails. Feb 2027 (estimate): Q4 fiscal 2027 results and the plan for fiscal 2028. Pending. Watch: Revenue for fiscal 2027 reaches the guided $5.03 billion to $5.07 billion and the first plan for fiscal 2028 shows growth above 20%, and this passes; slower growth or a lower margin fails.
Recent events: added: Sep 4, 2026: In its Form 10-Q, Everpure said that in Q2 certain conditions of one long-term supply arrangement were met. It now must buy about $1.1 billion of components through calendar 2027, directly or through its contract manufacturers. Prepaid expenses and other current assets rose to $1,025.6 million from $356.0 million at the end of fiscal 2026. Aug 26, 2026: Everpure reported Q2 fiscal 2027 results. Revenue rose 38% to $1,185.9 million. Product revenue rose 54% to $686.8 million, and subscription services revenue rose 20% to $499.1 million. Non-GAAP operating income was $229.6 million and GAAP operating income was $63.2 million. Free cash flow was negative $238 million. It bought back 0.9 million shares for about $69 million. Aug 26, 2026: Everpure raised its guidance for fiscal 2027 to revenue of $5.03 billion to $5.07 billion, from $4.41 billion to $4.51 billion, and non-GAAP operating income of $940 million to $960 million, from $820 million to $860 million. For Q3 it guided revenue of $1.325 billion to $1.335 billion and non-GAAP operating income of $265 million to $275 million. Aug 10, 2026: Everpure announced a design win with a second top-five hyperscaler. The customer will use its DirectFlash architecture to lower operating costs and to save power and rack space. May 7, 2026: Everpure bought 1touch, a maker of data intelligence and orchestration software, for $125.9 million in cash. It booked $101.2 million of goodwill and $19.5 million of intangible assets.