Back to top
Read MoreHide Full Article

Headquartered in Dublin, Ireland, Seagate Technology (STX - Free Report) is a global leader in data storage solutions. They are the second-largest manufacturer of hard disk drives in the US and offer other electronic data storage products including solid state hybrid drives, solid state drives and peripheral component interconnect express cards.

Weak Results

Seagate reported disappointing results for its fourth-quarter fiscal 2017 with both earnings and sales missing our estimates. Non-GAAP earnings of $0.65 per share fell 41% on a sequential basis and were significantly below the Zacks Consensus Estimate of 99 cents.

Revenues fell 9.3% year-over-year to $2.41 billion and also missed the estimate of $2.55 billion. Intense competition in the hard disk drive market from Western Digital and others hurt the results.

The stock fell almost 19% after the release.

Falling Estimates

Zacks Consensus Estimate for the current and next year have plunged to $3.83 per share and $4.12 per share respectively, from $4.75 and $4.77, before the results.

The Bottom Line

Computer Storage industry is witnessing a lot of competition lately. Further declining PC shipments have also created headwinds for the company.  In addition to a Zacks Rank #5 (Strong Sell), Seagate has a negative Earnings ESP of 11.63% suggesting strong chances of missing estimates again.

“Computer- Storage Devices” industry is currently ranked in the top 32% of all Zacks industries. Investors could consider Super Micro Computer (SMCI), which currently has a Zacks Rank #1 (Strong Buy).

 

Looking for Stocks with Skyrocketing Upside?

Zacks has just released a Special Report on the booming investment opportunities of legal marijuana.
 

Ignited by new referendums and legislation, this industry is expected to blast from an already robust $6.7 billion to $20.2 billion in 2021. Early investors stand to make a killing, but you have to be ready to act and know just where to look.

See the pot trades we're targeting>>




In-Depth Zacks Research for the Tickers Above


Normally $25 each - click below to receive one report FREE:


Seagate Technology PLC (STX) - free report >>


More from Zacks Bear of the Day

You May Like