Q1 Preview: Seagate (STX) to Report Results Amid Rumors to Go Private.
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Price: $850.00 -0.03%
Rating Summary:
30 Buy, 18 Hold, 2 Sell
Rating Trend: = Flat
Today's Overall Ratings:
Up: 8 | Down: 5 | New: 26
Rating Summary:
30 Buy, 18 Hold, 2 Sell
Rating Trend: = Flat
Today's Overall Ratings:
Up: 8 | Down: 5 | New: 26
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Seagate Technology PLC (NASDAQ: STX) shares are trading up 10 cents to $15.34 ahead of its scheduled first-quarter earnings release after the closing bell on Wednesday.
On October 14, Seagate acknowledged that it had recieved preliminary interest from a private-equity party to take the company private, which caused a 20 percent spike in the stock.
The hard drive maker is expected by analysts to report quarterly earnings of 45 cents per share on sales of $2.72 billion.
In the company's fiscal fourth quarter it reported earnings of 70 cents per share, missing the analyst estimate of 78 cents per share. Second-quarter revenue for the company was $2.66 billion, missing the consensus of $2.86 billion.
Since the start of the first quarter, shares of Seagate are up 86 cents or 5.92 percent. Year-to-date the stock is down $2.80 or 15.89 percent.
A valuation shows that Seagate is going for a forward P/E of 4.90x full-year 2010 estimates.
Data from Bloomberg shows that 13 analysts have a Buy rating on Seagate, 11 have a Hold and 2 have a Sell. The average price target on the stock is $15.80, with a target range of $12 to $23.50.
Notes from Analysts
Deutsche Bank sees Seagate struggling due to weakness in the consumer PC market and notebooks, as investors now expect muted seasonal demand this year.
Deutsche Bank analyst says, "With weaker demand pressuring ASPs, we expect Seagate to be at the low end of its guidance, or slightly lower. Demand for the December quarter will be a key focus for investors, with most now expecting units to be flat to only slightly up Q/Q."
Deutsche Bank Maintains a Buy rating with a $16.50 price target on Seagate.
On Monday, Argus cut is rating on Seagate from Hold to Buy on the discussion that the company had received a preliminary proposal to take the company private.
Argus also sees Seagate as a better play in the HDD market than rival Western Digital Corp. (NYSE: WDC), which is more exposed to notebooks and could see increased competition from Apple Inc.'s (NASDAQ: AAPL) iPad.
Argus analyst says, "We also see more downside risk if the proposed deal disintegrates than upside potential if it goes forward."
On October 14, Seagate acknowledged that it had recieved preliminary interest from a private-equity party to take the company private, which caused a 20 percent spike in the stock.
The hard drive maker is expected by analysts to report quarterly earnings of 45 cents per share on sales of $2.72 billion.
In the company's fiscal fourth quarter it reported earnings of 70 cents per share, missing the analyst estimate of 78 cents per share. Second-quarter revenue for the company was $2.66 billion, missing the consensus of $2.86 billion.
Since the start of the first quarter, shares of Seagate are up 86 cents or 5.92 percent. Year-to-date the stock is down $2.80 or 15.89 percent.
A valuation shows that Seagate is going for a forward P/E of 4.90x full-year 2010 estimates.
Data from Bloomberg shows that 13 analysts have a Buy rating on Seagate, 11 have a Hold and 2 have a Sell. The average price target on the stock is $15.80, with a target range of $12 to $23.50.
Notes from Analysts
Deutsche Bank sees Seagate struggling due to weakness in the consumer PC market and notebooks, as investors now expect muted seasonal demand this year.
Deutsche Bank analyst says, "With weaker demand pressuring ASPs, we expect Seagate to be at the low end of its guidance, or slightly lower. Demand for the December quarter will be a key focus for investors, with most now expecting units to be flat to only slightly up Q/Q."
Deutsche Bank Maintains a Buy rating with a $16.50 price target on Seagate.
On Monday, Argus cut is rating on Seagate from Hold to Buy on the discussion that the company had received a preliminary proposal to take the company private.
Argus also sees Seagate as a better play in the HDD market than rival Western Digital Corp. (NYSE: WDC), which is more exposed to notebooks and could see increased competition from Apple Inc.'s (NASDAQ: AAPL) iPad.
Argus analyst says, "We also see more downside risk if the proposed deal disintegrates than upside potential if it goes forward."
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