Morgan Stanley Upgrades Seagate Technology Stock to Overweight: Why Seagate is on Track for Significant Gains in the Data Storage Market and AI Revolution

The Surge in Seagate Technology Stock Price Today

In recent trading, Seagate Technology (STX) stock is experiencing a significant surge, with a 9% increase in share price as of 3 p.m. ET. This growth can be attributed to a report published by Morgan Stanley this morning, which upgraded its rating on Seagate from equal weight to overweight and raised its one-year price target from $73 per share to $115 per share.

Despite an impressive 56% increase in the past year, Seagate stock is still down about 17% from its peak. However, Morgan Stanley’s research suggests that they believe the storage hardware specialist will reach new heights in the near future. The firm predicts that Seagate will benefit from the recovery of the data storage market and its position in HAMR technologies, which will lead to stronger sales and earnings performance. Additionally, they anticipate that demand related to the rise of generative AI will be a significant driver of performance.

With the data storage industry on an upward trend and AI-related demand growing, Seagate’s profitability could see substantial improvements. Morgan Stanley’s analysts believe that Seagate’s earnings performance in the near term could exceed expectations by 25% to 30%. Furthermore, they expect that this connection to the AI revolution may result in investors assigning higher valuation multiples to Seagate and other data storage stocks.

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