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After Longbow's Downgrade Of Seagate And Western Digital, How Are Other Data Storage Stocks Looking?

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Longbow Research downgraded Seagate Technology (NASDAQ: STX) and Western Digital Corporation (NASDAQ: WDC) on Monday, moving both from Buy to Neutral.

Although specialist Joe Wittine doesn’t think investors should get rid of these stocks, he does not see as much upside potential in them as he did 18 months ago.

“After the 20-30% share appreciation since mid-October and total 18 month returns of 85%+ for WDC and 61% for STX, we no longer see the required 20% upside in order to maintain our BUY ratings for putting new money to work,” Wittine explained.

But, how to other analysts feel about the industry?

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Seagate Technology

Longbow’s downgrade was accompanied by a $67 price target, although the stock currently trades around $68.36. Unlike Wittine, Ananda Baruah of Brean Capital recently reiterated a Buy rating on Seagate, boosting his price target from $70 to $83 on the back of positive December-quarter projections.

Last week, Citigroup reiterated its Buy recommendation for the company, upping its price target from $70 to $74. Shares currently trade near $68.60.

Western Digital

Although Longbow set a price target of $110 on this stock (below the current stock price near $114), Brean Capital raised its target from $125 to $150. Citigroup, meanwhile, holds a $125 price target on the stock and maintains a Buy rating.

Jefferies issued a Buy rating on December 10 with a $129 price target.

EMC Corporation (NYSE: EMC)

On December 10, JP Morgan initiated coverage with a Neutral rating and a price target of $31. The stock currently trades around $30.34, so upside potential is limited.

In mid-November, Maxim Group also assumed coverage with a Hold rating and a $30 price target. 

SanDisk Corporation (NASDAQ: SNDK)

Since the start of November, the company received four Buy ratings at Goldman Sachs, BTIG Research, Summit Research Partners and Stifel Nicolaus.

One reason for the bullishness: As mentioned by Summit's Srini Sundararajan, "Weak Yen [helps]...more than any other factor," along with a strong market position and data growth.

Latest Ratings for STX

Jan 2017GuggenheimInitiates Coverage OnNeutral
Oct 2016Brean CapitalMaintainsBuy
Oct 2016Morgan StanleyMaintainsEqual-Weight

View More Analyst Ratings for STX
View the Latest Analyst Ratings

Posted-In: Ananda Baruah Brean CapitalAnalyst Color Long Ideas Downgrades Price Target Analyst Ratings Trading Ideas


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