Seagate Rises on Upgrade Ahead of Earnings

By Yasin Ebrahim

Investing.com – Seagate edged higher Monday, just a day ahead of its fiscal second-quarter report after one analyst upgraded the storage company to buy, forecasting shares to rise by about a fifth.

Stifel upgraded shares of Seagate to buy from hold and raised its price target on the stock to $70, nearly 20% above current levels. Seagate Technology (NASDAQ:) rose 0.9%.

Losing about 8% from its recent peak on Jan.24, shares of Seagate are now a buying opportunity, with a valuation made all the more attractive by a favorable backdrop for data center fundamentals, Stifel suggested.

But not everyone agrees amid concerns about near-term demand and the impact of the coronavirus risk.

Wedbush analyst Matt Bryson remained on the sidelines, maintaining his neutral rating on Seagate, on worries about a lofty valuation. And expressed concerns that the company will “not be able to meet forward expectations in light of what we expect to be flattish nearline market demand, slower immediate 16 TB penetration rates, and now coronavirus related risk.”

“Seagate’s operations in Suzhou, could potentially be directly impacted by the coronavirus outbreak,” Bryson added.

Seagate is slated to report quarterly results on Tuesday. Wall Street expects the company to generate of $1.31 per share on revenue of $2.32 billion.

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