Key Highlights
- Seagate delivered Q3 earnings per share of $4.10, surpassing Wall Street’s $3.47 projection, alongside revenue of $3.11B versus $2.94B expected
- The company’s Q4 outlook calls for $4.80–$5.20 EPS, exceeding analyst projections
- BofA Securities increased its price objective to $840 from $700, reaffirming a Buy rating
- Rosenblatt Securities established the Street’s highest target at $1,000; the average analyst target stands at $669.75
- Shares traded near $642 on Wednesday, gaining approximately 10% during the session
Seagate Technology (STX) delivered robust fiscal third-quarter results that exceeded earnings and revenue projections by significant margins, propelling shares upward by nearly 10% during Wednesday’s trading session.
Seagate Technology Holdings plc, STX
The data storage manufacturer announced earnings per share of $4.10 for the period, substantially exceeding the Wall Street consensus of $3.47. Revenue reached $3.11 billion, surpassing analyst expectations of $2.94 billion. This represents a year-over-year revenue increase of 44.1%.
The quarter generated approximately $1 billion in free cash flow, while the company achieved record profit margins. These results reflect ongoing AI-fueled demand for data storage solutions that continues to constrain hard disk drive availability.
Looking ahead, Seagate issued fourth-quarter guidance projecting earnings per share between $4.80 and $5.20, with revenue expected in the range of $3.4B to $3.6B — figures that surpass current analyst forecasts.
Pricing trends also showed positive momentum. The firm reported a 6% improvement in revenue per terabyte, both compared to the prior year and the previous quarter.
Wall Street Revises Targets Upward
BofA Securities elevated its price objective to $840 from $700, maintaining its Buy recommendation. The investment bank highlighted constrained HDD supply, robust artificial intelligence demand, and disciplined cost management as primary catalysts. BofA also emphasized that the transition to heat-assisted magnetic recording (HAMR) technology is contributing to declining costs on a year-over-year basis.
Rosenblatt Securities established the most aggressive stance, doubling its price target from $500 to $1,000 while assigning a Buy rating. JPMorgan upgraded its objective to $775 with an Overweight designation. Citigroup lifted its target to $740, maintaining a Buy rating. The consensus among 25 analysts now stands at $669.75, with 20 recommending Buy and five at Hold.
UBS represented a more conservative perspective, raising its target modestly from $515 to $545 while maintaining a Neutral stance — a projection that suggests potential downside of approximately 15% from current trading levels.
Demand Visibility Through 2027
Nearline storage capacity has been essentially committed through calendar year 2027. Seagate has been completing build-to-order agreements extending through the conclusion of fiscal 2027, securing both product specifications and pricing terms. This provides the organization with exceptional forward visibility into revenue streams.
BofA Securities anticipates sustained expansion in pricing power, profit margins, and cash generation through fiscal 2027, highlighting that six analysts have lifted their earnings projections for forthcoming periods.
The equity has appreciated 619% during the trailing twelve months. Shares changed hands at $642.62 on Wednesday, advancing $63.59 during the session, with volume approaching 6.9 million shares — considerably exceeding the typical average of 4.1 million.
From a valuation perspective, the stock currently trades at a price-to-earnings multiple of approximately 72.6, while carrying a debt-to-equity ratio of 7.63 — metrics that certain analysts identify as potential concerns should artificial intelligence investment activity decelerate.
Seagate announced a quarterly dividend distribution of $0.74 per share, with a record date set for June 24 and payment scheduled for July 7.
Chief Executive Officer William Mosley divested 20,000 STX shares on April 1 at an average execution price of $420.73, representing a total transaction value of $8.4 million, completed under a previously established Rule 10b5-1 trading arrangement.
