Seagate Technology Upgraded by Morgan Stanley: Stock Prices Soar on Positive Outlook for Data Storage Industry

The Surge in Seagate Technology Stock Price Today

Morgan Stanley has upgraded its rating on Seagate Technology (STX) from equal weight to overweight, leading to a 9% increase in share price as of 3 p.m. ET on Tuesday. The firm’s analysts have also raised their one-year price target on Seagate stock from $73 per share to $115 per share, suggesting that they believe the storage hardware specialist will reach a new peak valuation in the near future.

Despite a 56% increase in the last year, Seagate stock is still down about 17% from its high. However, Morgan Stanley’s coverage suggests that they are optimistic about the future of the data storage industry and Seagate’s position within it. The firm predicts that Seagate will benefit from the recovery in the data storage market and its position in HAMR technologies, which will lead to stronger sales and earnings performance. Additionally, they anticipate that demand related to the rise of generative AI will be a significant performance driver for Seagate.

With AI-related demand growing and the data storage industry on an upswing, Seagate’s profitability could see substantial improvements. Morgan Stanley’s analysts believe that Seagate’s earnings performance in the near term could exceed expectations by 25% to 30%. Furthermore, the connection to the AI revolution may result in investors assigning higher valuation multiples to Seagate and other data storage stocks.

Keith Noonan has no position in any of the stocks mentioned. The Motley Fool also has no position in any of the stocks mentioned and has a disclosure policy.

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