arclays Maintains an 'Equalweight' on Seagate Technology (STX); Update Suggests Significant HDD Price Increases

Barclays maintains an 'Equalweight' on Seagate Technology (NASDAQ: STX) price target raised $1 to $19.

Barclays analyst says, "Given Seagate's announcement, pricing appears to be stronger than we expected and gross margins could be up 850 bps q/q. Seagate remains well positioned to gain share from competitors near-term given its undamaged capacity. That said, Seagate's update also points to upside at Western Digital and its soon to be acquired Hitachi GST, simply because of significantly higher pricing."

"For STX, we are raising our F2Q12 estimate to $0.70 (vs. $0.50) based on revenue of $2.8B (was $2.65B) with gross margins of 28.0% (vs. 25%). For FY12, our estimate increases to $3.19 (was $2.77) based on revenue of $12.4B. For FY13, we are also increasing our estimate to $2.79 (was $2.46) based on revenue of $11.88B, -4% y/y, with gross margins of 25.5% (was 23.3%)."

For an analyst ratings summary and ratings history on Seagate Technology click here. For more ratings news on Seagate Technology click here.

Shares of Seagate Technology closed at $15.99 yesterday.

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