Morningstar Rating

Stock Research and Analysis

by Simran Kaur

Bulls Say

HAMR will further improve HDD's relative technological standing (in terms of capacity and cost) and will bump up margins on higher demand and higher fixed-cost absorption.
Seagate's NAND supply agreement with Samsung is very advantageous and will help support higher margins for its hybrid products.
PC demand from emerging markets will provide a substantial total addressable market for Seagate's desktop products. Read more 

Bears Say

Demand for hybrids may not materialize, as customers may prefer to integrate NAND with HDDs on their own.
Seagate has high financial leverage, with debt/capital at about 58%. This may lead to losses for equityholders in weak demand environments.
Samsung may not be able to hold its leading position in the dynamic NAND market and Seagate may need to form partnerships with other leading NAND suppliers. Read more 

Management

We view Seagate's stewardship of shareholder capital as standard. Chairman, president, and CEO Stephen Luczo was CEO from 1998 to 2004 and resumed leadership of the company in January 2009. Luczo received $19.8 million in total compensation in 2013,  Read more 

Profile

Seagate Technology manufactures data storage products that include hard drives (95% of revenue), solid-state hybrid drives, and solid-state drives. Key end markets are client   Read more 

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