GadgetBlips - Latest Seagate News Articles

UBS Lifts PC Forecasts For 2009, 2010

Tue, 24 Nov 2009 16:39:23 +0000

UBS analyst Maynard Um this morning lifted his 2009 PC unit forecast to positive 0.4%, from -2.1%, reflecting an expected 10% year-over-year growth rate in the fourth quarter. “Demand has proven more resilient than expected driven by aggressive consumer pricing and fiscal stimulus,” he writes in a research note. “We expect consumer demand in Q4 to continue to be driven by promotional activity, but believe unit growth is likely to see lower-than-normal seasonality due to component tightness.” (Offsetting that, he thinks Q1 should be better than seasonal.) For 2010, he now sees 12.6% unit growth, up from 8.8% previously. He says growth should be driven by a better economy and “design-focused consumer PCs,” as well as enterprise PC refresh - although he does not expect a meaningful uptick in enterprise until mid-2010. Um says is favorite picks in the PC sector are Apple (AAPL) , Hewlett-Packard (HPQ) and Seagate (STX) . Among Asian plays, he favors ...

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Disk Drives: Merrill Downgrades Seagate, Western Digital

Wed, 18 Nov 2009 15:09:29 +0000

Bank of America/Merrill Lynch analyst Scott Craig today cut his ratings on both Seagate (STX) and Western Digital (WDC) to Underperform from Buy. He set a price target of $15 for STX, which yesterday closed at $17.01; for WDC his target is $35, below yesterday’s close at $39.16. Craig notes that shares of both disk-drive companies have rallied dramatically: Since March, WDC is up 208%, and STX is up 452%. He says industry fundamentals are near peak levels on many metrics. “While the end demand environment and possible inventory replenishment may drive the stocks higher near-term, we believe the easy money in the cyclical hard-disk drive stocks has been made,” he writes. Craig worries that 2010 could see capacity expansion in the industry, creating a risk of pricing and margin pressure. He thinks the industry will start adding capacity in the first half of next year, and that both companies are likely to increase their capital spending forecasts. He notes that pricing ...

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