Brean Murray Reiterates Buy Rating, $35 PT on Seagate Technology

In a report published Monday, Brean Murray, Carret & Co. reiterated its Buy rating and $35.00 price target on Seagate Technology STX. Brean Murray noted, “STX Analyst Day went off in line with our expectations, including STX's Sep Q update and new L‐T model, with the management team doing a good job of discussing L‐T industry opportunities, including how ongoing strong digital data growth translates into Enterprise drive growth and revenue mix opportunities – even in the face of a very soft PC opportunity that we believe can range anywhere from slight growth to declines in coming years. If we play STX's L‐T model through, normalized EPS looks like $6.00 ‐ $8.00. We remind investors that STX is also looking to repurchase 25% of the company by the end of CY14 and pays a 4.2% dividend which it intends to increase annually. Currently STX trades at 5x our CY13 FCF estimate of $2.1B, a 17% FCF yield.” Seagate Technology closed on Friday at $30.96.