Citing strong traction with cloud clients using hyperscale data center architectures (Google, Facebook, Amazon, etc.), Baird has upgraded Western Digital (WDC +2.7%) to Outperform, and hiked its PT by $25 to $120. Seagate (STX +1.6%) is following Western higher.
Also possibly helping: Intel beat Q2 estimates and issued strong Q3/full-year guidance. The chip giant reported 6% Y/Y sales growth for its PC CPU reporting segment, and 19% growth for its server CPU segment.
Gartner has forecast cloud demand will help drive a 25.1% CAGR for shipments for high-capacity business-critical drives from 2013-2018. On the other hand, soft enterprise storage sales and SSD cannibalization are expected to produce a -4.9% CAGR for performance-optimized business drives; Seagate has a stronger position here than Western.
Western is hoping its helium drives will help it maintain its Web/cloud momentum. Seagate reports tomorrow, and Western on July 30.