Stockchase Opinions

The Panic-Proof Portfolio (Stockchase Research) Seagate Technology STX-Q TOP PICK Oct 27, 2020

Stockchase Research Editor: Michael O'Reilly This solid dividend player is trading at a great PE valuation following its most recent earnings report. Earnings reflected a 10% drop in revenues from a year ago, as HDD was weaker than expected, but was partially offset by its cloud data center demand and video applications. The company stands by its guidance numbers, whose mid-points are above current analyst expectations. Trading at a 10 PE it is great value compared to the sector average PE of 63. It pays a great dividend backed by a 38% payout ratio. We would trade this with a $42 stop-loss, looking for a technical target of $60 -- almost 25% upside. Yield 5.47% (Analysts’ price target is $53.41)
$48.560

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This is a Panic-proof Portfolio opinion which is available only for Premium members

Curated by Michael O'Reilly since 2020.
1550+ opinions with 4.81 rating (one of the best performing expert).

PAST TOP PICK
(A Top Pick Oct 27/20, Up 70.3%)Stockchase Research Editor: Michael O'Reilly We are recommending trailing up the stop to $65. This would all but guarantee a minimum investment return of 29%, including the previous recommendation to cover 50%.
premium

This is a Panic-proof Portfolio opinion which is available only for Premium members

Curated by Michael O'Reilly since 2020.
1550+ opinions with 4.81 rating (one of the best performing expert).

PAST TOP PICK
(A Top Pick Oct 27/20, Up 114.1%)Stockchase Research Editor: Michael O'Reilly Our PAST TOP PICK with STX continues to make good progress. We now recommend trailing up the stop (from $65) to $85. If triggered, this would all but guarantee a minimum investment return of 50%, when considering the previous recommendation to cover half of the holding.
premium

This is a Panic-proof Portfolio opinion which is available only for Premium members

Curated by Michael O'Reilly since 2020.
1550+ opinions with 4.81 rating (one of the best performing expert).

PAST TOP PICK
(A Top Pick Oct 27/20, Up 75%)Stochchase Research Editor: Michael O'Reilly Our PAST TOP PICK with STX has triggered its stop at $85. We recommend covering the balance of the position now. Combined with the previous recommendation to cover 50%, this will result in a net investment return exceeding 50%.
DON'T BUY
Missed earnings and was downgraded today. Much prefers Taiwan Semi and Samsung which are behemoths compared to Seagate.
BUY
It has bottomed. It pays a 5.4% dividend yield and trades at 11x in a business that has insatiable demand for hard-drive storage.
BUY

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

BUY

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.

BUY

Seagate just reported a great quarter.

BUY

A buy off of Dell's strong earnings report.

DON'T BUY

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