Seagate initiated with an Outperform at Evercore ISI

Evercore ISI analyst Amit Daryanani initiated coverage of Seagate with an Outperform rating and $110 price target. The firm thinks not just the Hard Disk Drive industry, but Seagate specifically, is positioned to benefit from a combination of a cyclical recovery with Hyperscalers and beyond, a more disciplined HDD marketplace, margin expansion as Heat Assisted Magnetic Recording, or HAMR, technology scales up and capital allocation that will skew to buybacks going forward. Evercore estimates Seagate can get to $10-12 EPS power by possibly FY27 and in that framework the stock will have “sizable upside from current levels,” the analyst tells investors.