Seagate Technology (STX)

They can't make their disc drives--used in data centres--fast enough. Shares surged 11%. This is a horse.

They have absurd pricing power given the strong demand for memory storage. Shares jumped 19% today. It takes four years to build a new factory so the storage shortage should continue.

It reports Tuesday. No one saw the massive surge in memory stocks. STX is up 25% this year already, so it needs to deliver a massive beat and raise to keep the rally going. He thinks they can do it.

Sells at 20x PE, up 63% this year and one of the top S&P performers, but the PE and stock are too high.

The stock has never done and has always been cheap. It's a value trap.

A buy off of Dell's strong earnings report.

Seagate just reported a great quarter.

Just bought this for the first time. AI is driving a new refresh cycle in PCs. Also, we haven't upgraded PCs in 4-5 years. Dell just said their PC business was up 3% instead of the expected -2%. HPQ will see growth in the second half of this year, for the first time in 2 years. Also, AMD said last Sunday that their AI PC chips are 5x the speed of existing chips. Seagate leads this sector. Gross margins are poised to go higher. Margins could expand 1,000 basis points year over year. They have pricing power and volumes are rising. She might be early on it, but that's fine.

Memory chips are bottoming now and management just stood behind its 4.8% dividend yield.