Seagate Technology (STX)

Summary

• Seagate’s dividend yield is 3.78% and its quarterly dividend per share has tripled since 2011.
• Seagate's adjusted dividend payout ratio is only 42% which enables Seagate to meet our expectations for 5% annual long-term dividend growth.
• Seagate's dividend yield is well above the S&P 500 and its closest competitor Western Digital.
• Seagate repurchased $5.3B worth of its shares since the end of 2011, but we don't expect significant buybacks in the future.
• We expect that dividends will be the only source of near-term return for Seagate investors.

Summary

• Cash flow and earnings are strong.
• CEO said buybacks are attractive under $60 per share.
• Dividends appear to be the preferred way to return cash to shareholders.

Summary

• Seagate Technology is scheduled to announce its Q2 FY 2015 earnings Monday.
• The company expects the strong demand for enterprise storage and notebook hard drive units to continue through the fourth calendar year quarter as well.
• We have a $58 price estimate for Seagate’s stock, which is almost 10% lower than the current market price.

Summary

• A recovery in PC shipments is now evident.
• Rather than picking which PC-related stock will benefit, it's better to own a large piece of a PC-related industry.
• STX and WDC are great choices with their HDD market share and investments outside of PCs.

Summary

• Seagate announces interesting products at CES including the wireless product that offers a 500GB portable wireless hard drive that is compatible with popular smartphones and tablets.
• Bullish yields including a large-scale stock repurchase plan have supported the surging stock price over the last several years.
• Seagate is a solid buy based on value and continuously high yields.

Summary

• Growth in the industry fueled by increased demand for data storage (expected to multiply by 10 times between 2013 and 2020).
• Acquisition of Xyratex in March 2014: Better vertical integration of backend testing and integrating drives onto OEM capital equipment to support.
• Relatively low P/E ratio despite strong projected growth.

Summary

• Seagate Technology had an impressive quarter.
• Revenue has grown at a strong clip in the October quarter in spite of the slight decline in the June quarter.
• Gross margins continue to remain strong, and although net profit margins have slipped, this is due to one-time expenses.
• Prospects for the data storage industry are bright, with huge opportunities for growth.
• Given Seagate’s strong presence within the industry, expect the company to be able to capitalize on said opportunities.

Summary

• The model starts from the assumption made by management on future revenue growth, adjusted for expected declines in the long-term.
• The estimated cost of equity goes from 12% in 2015 to 9% in the steady state.
• Fair value estimated by the model is in-line with current market values but downside risk is possible.

Summary

• WDC has performed better than STX over last 16 months.
• In the past, STX drives were considered inferior to WDC in performance.
• Last quarter, STX unveiled data that might make it a better investment of the two stocks.

Summary

• Ranking the top twenty S&P 500 dividend stocks, according to a winning ranking system.
• Explanation and back-testing of the "ValueSheet" ranking system.
• Description and a buy recommendation for the third-ranked stock of the system: Seagate Technology.

Summary

• Dividend raised to $0.54 per quarter from $0.42, or about 3.6%.
• Revenue rose, but net income fell y/y.
• Plan is to expand the model further with hybrid and flash technology.

Summary

• The global demand for data storage is expected to grow, and Seagate is making smart moves to tap this demand.
• Seagate is focusing on product innovation and acquisitions to strengthen its portfolio.
• Seagate's valuation is impressive and indicates long-term growth.

Summary

• Although STX's stock price has gained an astounding 262.8% since the beginning of 2012, it still has plenty of room to move up.
• STX's stock is ranked second among all S&P 500 stocks, according to Portfolio123's "ValueSheet" powerful ranking system.
• Seagate returned $2.5 billion to shareholders in the form of dividends and share redemptions in fiscal year 2014.

Summary

• Seagate Technology is scheduled to announce its Q4 FY 2014 earnings on July 17.
• Its Q4 revenues could be 6% lower than the year-ago quarter. However, the company expects demand to pick up in the latter half of the calendar year.
• Seagate completed the acquisition of Xyratex in March this year, with the latter likely to contribute about $100 million to Seagate’s top line in Q4 FY 2014.

Summary

• At the end of May, Seagate announced the acquisition of the flash business from networking semiconductor and chip manufacturer Avago Technology for $450 million.
• The flash business is crucial to Seagate because of an increasing mix of solid state drives, which use flash components, compared to traditional hard disk drives.
• The acquisition continues the trend of consolidation across the storage industry, with major storage companies acquiring smaller specialist manufacturers.

Summary

• Seagate is acquiring the SSD assets of LSI.
• HDD storage is still far cheaper than SSD.
• Seagate could return to growth, and a higher P/E.

Summary

• After the retreat in its stock price, it is now an excellent opportunity for a long-term investment in STX at a cheap price.
• STX's stock is a very good combination of value and growth dividend stock.
• STX's Enterprise Value/EBITDA ratio is extremely low at 6.57.
• The new acquisition of Xyratex will expand STX's storage solutions portfolio even more.

Summary

• 3 insiders sold Seagate stock within one month.
• The stock was not purchased by any insiders in the month of intensive selling.
• 2 of these 3 insiders decreased their holdings by more than 10%.

Summary

• Demand for the company's products will in part be driven by cloud-service providers and big data analytics.
• The shares are currently fairly valued in the market.
• The technicals are bullish with the intermediate trend being bearish and the primary trend being bullish.