Analyst Krish Sankar from TD Cowen maintained a Buy rating on Seagate Tech (STX – Research Report) and keeping the price target at $135.00.
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Krish Sankar has given his Buy rating due to a combination of factors surrounding Seagate Tech’s strategic acquisition of Intevac. This acquisition is seen as a continuation of Seagate’s vertical integration strategy, similar to its past acquisition of Xyratex. Intevac’s Lean 200 platform holds a significant market share in HDD deposition equipment, which is crucial for the advancement of Seagate’s HAMR technology.
Furthermore, although the acquisition could pose a short-term distraction for competitors like WDC, it is not expected to hinder their progress in the HAMR platform. Seagate’s move to acquire Intevac is anticipated to enhance its supply chain capabilities and prepare for the HAMR ramp-up. Despite the potential increase in operational expenses by approximately $30 million annually, Seagate is positioned to offset these costs partially, reinforcing the positive outlook on their stock.
In another report released on February 10, Evercore ISI also maintained a Buy rating on the stock with a $135.00 price target.
Based on the recent corporate insider activity of 85 insiders, corporate insider sentiment is negative on the stock. This means that over the past quarter there has been an increase of insiders selling their shares of STX in relation to earlier this year.