According to TheFly, several brokerages raised their price targets following Seagate’s Q4 results, with Rosenblatt describing the quarter as a “clean beat-and-raise.”
- Rosenblatt maintained a ‘Buy’ rating on Seagate shares and raised its price target to $1,400 from $1,300, implying an upside potential of about 87% from Tuesday’s closing price.
- The firm said management expects a widening supply-demand imbalance to drive sequential improvements in revenue, gross margin and profitability throughout fiscal 2027.
- Morningstar said the AI buildout is transforming what was historically a highly cyclical hard disk drive business into one with steadier demand and greater pricing discipline.
Seagate Technology Holdings (STX) won fresh backing from Wall Street after a beat-and-raise quarter, prompting analysts to argue that the hard disk drive (HDD) maker is entering a new era of pricing power fueled by AI demand.
According to TheFly, several brokerages raised their price targets following Seagate’s Q4 results, with Rosenblatt describing the quarter as a “clean beat-and-raise.”
Seagate shares were up about 5% in Wednesday’s pre-market trade. STX was among the top trending tickers on Stocktwits at the time of writing.
Wall Street Sees A ‘New Pricing Regime’
Rosenblatt maintained a ‘Buy’ rating on Seagate shares and raised its price target to $1,400 from $1,300, implying an upside potential of about 87% from Tuesday’s closing price.
The firm said management’s comments suggest the HDD industry has entered a “new pricing regime,” pointing to a widening supply-demand imbalance and expectations for sequential improvements in revenue, gross margin and profitability throughout fiscal 2027.
Citi lifted its price target to $1,300 from $1,240 while keeping a ‘Buy’ rating, saying Seagate’s growing adoption of heat-assisted magnetic recording (HAMR) technology is driving stronger profitability.
Wells Fargo increased its target to $1,180 from $1,100 with an ‘Overweight’ rating on the stock, saying that Seagate’s Q4 reinforced its thesis that nearline storage demand can continue growing at the upper end of the 25% to 30% annual range. The firm also added that higher pricing and lower production costs per terabyte support a path toward gross margins in the mid-60% range for the company.
Morningstar Sees Multi-Year Growth Runway For STX
Morningstar said Seagate’s latest results reinforce its view that the company is entering a multi-year period of high-visibility, high-margin growth.
The firm said nearline storage capacity is fully committed through 2026, largely allocated for 2027, with discussions for 2028 already underway, providing unusual revenue visibility for the company.
Morningstar said the AI buildout is transforming what was historically a highly cyclical hard disk drive business into one with steadier demand and greater pricing discipline.
The firm said AI-driven demand has fundamentally improved the industry’s pricing dynamics, allowing Seagate to push through mid-single-digit annual price increases through the end of the decade.
Morningstar also expects higher-capacity HAMR drives, more disciplined industry supply and steadier data center demand to drive structurally higher margins than in previous HDD cycles.
STX’s Q4 At A Glance
Seagate reported earnings per share (EPS) of $5.71 on revenue of $3.63 billion, compared to Wall Street estimates of an EPS of $5.09 on revenue of $3.49 billion, according to Fiscal.ai data.
The company forecast Q1 EPS in the range of $ 7.10 and $ 7.50 on revenue of $4 billion to $4.2 billion. Wall Street expects Seagate to report an EPS of $6.08 on revenue of $3.8 billion.
“Our performance is being driven by robust cloud data center demand and disciplined execution, and we see the momentum continuing in 2027,” said Seagate CEO Dave Mosley.
What Retail Investors Think Of STX Stock
Retail sentiment on Stocktwits around Seagate trended in the ‘extremely bullish’ territory, with message volumes at ‘extremely high’ levels at the time of writing.
STX stock is up 171% year-to-date and 397% over the past 12 months. The S&P 500 ETF (SPY) is up 16% over the past 12 months, while the Invesco QQQ Trust (QQQ) is up 19%.
The Vanguard Growth Index Fund ETF (VUG) is up 10% during this period, while the Vanguard Total Stock Market Index Fund ETF (VTI) is up 17%.
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