Bernstein Rates Seagate (STX) Outperform, HDD Rebound & HAMR Drive $250 PT

Seagate Technology Holdings plc (NASDAQ:STX) is one of the best performing data center stocks to buy now. On September 16, Bernstein SocGen analyst Mark Newman initiated coverage of Seagate with an Outperform rating and a $250 price target. As reasons for his positive rating, he pointed to both near-term and long-term drivers supporting growth.

The analyst pointed to a rebound in hard disk drive (HDD) demand and noted Seagate’s edge in Heat-Assisted Magnetic Recording (HAMR), a technology expected to drive future market share gains. He added that, even after the stock’s recent rally, the shares still look reasonably valued given expectations for EPS growth of more than 20% a year.

His $250 target implies 18.5x FY27 EPS of $13.27, roughly in line with the company’s five-year historical average, which he characterized as conservative considering Seagate’s expanding technology edge and robust earnings and free cash flow trajectory.

Seagate Technology Holdings plc (NASDAQ:STX) is a global leader in data storage solutions, specializing in hard disk drives, solid-state drives, and advanced storage technologies.

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Disclosure: None. This article is originally published at Insider Monkey.