STX

[Melf Elf]

Investors had their own ideas, though.  Shares of Seagate fell 11 percent during the week to end Thursday at $20.06 on the New York Stock Exchange.

Oliver,

Technically, a big reason that investors had their own ideas and weren't buying the bullish call (literally) was that on Friday, September 1, STX:

1. Put in a Bearish Doji Star Hangman

2. At the top of a Bear Flag

3. Just below the 200DMA, which is bearishly positioned above the 50DMA

The Bear Flag broke at 20.92 on Wednesday of this week.

Note The Street.com's call last January for a year-end target of $32.  STX topped out six weeks later,  has completed several bearish patterns throughout 2006, and currently is 37% below the $32 year-end target.

I suspect that there might be a nice buying opportunity in this stock/sector before year end.  Just as they "sell the good news" at tops when "earnings were much better than expected," there could be a "buy the bad news selloff" when "the earnings were worse than we expected," and when analysts are downgrading the sector, like last October.

Stocks often behave in a counter-intuitive manner (meaning that they act opposite of what seems to make sense).

I wrote a piece earlier in this folder about how STX broke out of a beautiful Bullish Inverse H&S pattern on November 24, 2004 and rallied 50% into June, 2005 when the P/E ratio was fairly high, and how it broke down from a H&S Top in August, 2005 when the P/E ratio was very low.

Sometimes, the market doesn't make sense.   

Where it did make sense was the 100+% rally in STX from October, 2005 to March, 2006.  The stock was rewarded for the good fundamentals.

[la-onda]

update:
1)
SEAGATE TECHNOLOGY (STX.N: Quote, Profile, Research)
Current Prior Rating Neutral Buy

--Merrill Lynch said though the company beat the brokerage's earnings expectations for the first quarter, Seagate lowered its second-quarter and full-year expectations.

--The brokerage said improvements for the maker of computer hard-disk drives would be dramatic in the second half of fiscal 2007 but fall shy of the company's revised outlook.

--Merrill Lynch said it now expects Seagate's 2007 earnings per share at $1.60, compared with the company's outlook of $1.70 to 1.80. (Reporting by Purwa Khandelwal in Bangalore)

2)
Seagate Technology initiated with "underweight"

Thursday, October 05, 2006 10:26:56 AM ET
Prudential Financial

NEW YORK, October 5 (newratings.com) - Analyst Jesse Tortora of Prudential Financial initiates coverage of Seagate Technology (STX.NYS) with an "underweight" rating. The target price is set to $17. In a research note published this morning, the analyst mentions that the company is expected to gain 25% share of the high-growth 1.8" market by the end of 2007 or early 2008. The analyst expresses her concern regarding weakening demand in the PC and HDD markets, which is resulting in increasing inventories across the supply chain. Prudential Financial expects the company to face margin pressure and tough pricing trends in the forthcoming quarters.

[fous]

Im short STX. Looks like we got a double top forming

[la-onda]

STX update:
1)
Seagate Technology "outperform," target price reduced
Wednesday, April 18, 2007 9:00:03 AM ET
Credit Suisse
NEW YORK, April 18 (newratings.com) - Analysts at Credit Suisse reiterate their "outperform" rating on Seagate Technology (STX.NYS). The target price has been reduced from $35 to $28.
2)
Seagate Technology "underweight," target price reduced
Wednesday, April 18, 2007 10:24:24 AM ET
Prudential Financial
NEW YORK, April 18 (newratings.com) - Analysts at Prudential Financial reiterate their "underweight" rating on Seagate Technology (STX.NYS). The target price has been reduced from $21 to $19.
3)
Seagate Technology "sector perform," target price reduced
Wednesday, April 18, 2007 10:27:40 AM ET
RBC Capital Markets
NEW YORK, April 18 (newratings.com) - Analysts at RBC Capital Markets reiterate their "sector perform" rating on Seagate Technology (STX.NYS). The target price has been reduced from $26 to $23.
4)
Seagate Technology downgraded to "hold"
Wednesday, April 18, 2007 10:54:34 AM ET
Brean Murray, Carret & Co
NEW YORK, April 18 (newratings.com) - Analysts at Brean Murray downgrade Seagate Technology (STX.NYS) from "buy" to "hold." The target price has been reduced from $35 to $25.
5)
Seagate Technology downgraded to "hold"
Wednesday, April 18, 2007 11:12:35 AM ET
WR Hambrecht + Co
NEW YORK, April 18 (newratings.com) - Analysts at WR Hambrecht downgrade Seagate Technology (STX.NYS) from "buy" to "hold."
6)
Seagate Technology "above average," target price reduced
Wednesday, April 18, 2007 12:58:18 PM ET
Caris & Company
NEW YORK, April 18 (newratings.com) - Analysts at Caris & Company reiterate their "above average" rating on Seagate Technology (STX.NYS). The target price has been reduced from $24 to $23.
7)
Seagate Technology "buy," target price reduced
Wednesday, April 18, 2007 1:01:29 PM ET
A.G. Edwards & Sons
NEW YORK, April 18 (newratings.com) - Analysts at AG Edwards reiterate their "buy" rating on Seagate Technology (STX.NYS). The target price has been reduced from $33 to $28.
8.)
Seagate Technology "underweight," target price reduced - update
Wednesday, April 18, 2007 1:42:57 PM ET
Prudential Financial
NEW YORK, April 18 (newratings.com) - Analyst Jesse Tortora of Prudential Financial reiterates her "underweight" rating on Seagate Technology (STX.NYS), while reducing her estimates for the company. The target price has been reduced from $21 to $19.
In a research note published this morning, the analyst mentions that the company has reported its EPS for the March quarter short of the recently reduced consensus expectation due to lower-than-anticipated demand and higher-than-expected pricing pressure for its desktop class drives. Seagate Technology has reduced its EPS guidance for the June quarter by roughly $0.25 to $0.34-$0.38, which indicates gross margins of 22%, short of the previous guidance of 24%-26%. The EPS estimates for FY07 and FY08 have been reduced from $1.60 to $1.37 and from $2.62 to $2.02, respectively.
9)
Seagate Technology "neutral," target price reduced - update
Wednesday, April 18, 2007 2:34:58 PM ET
UBS
NEW YORK, April 18 (newratings.com) - Analysts at UBS maintain their "neutral" rating on Seagate Technology (STX.NYS), while reducing their estimates for the company. The target price has been reduced from $26 to $23.
In a research note published this morning, the analysts mention that the company has posted its F3Q07 non-GAAP EPS short of the estimates. The downward revision in the EPS estimates reflects a weaker market for the desktop consumer PCs and a more challenging competitive environment, the analysts add. The EPS estimates for 2007 and 2008 have been reduced from $1.66 to $1.40 and from $2.55 to $2.16, respectively.

[la-onda]

last but not least:
Seagate Technology "buy," price objective reduced

Thursday, April 19, 2007 2:39:03 AM ET
A.G. Edwards & Sons

NEW YORK, April 19 (newratings.com) - Analyst Aaron C Rakers of AG Edwards maintains his "buy" rating on Seagate Technology (STX.NYS), while reducing his estimates for the company. The 12-18 month price objective has been reduced to $28.

In a research note published yesterday, the analyst mentions that the company has reported its F2Q07 revenues in-line with its weaker-than-expected preliminary results. Seagate Technology has issued its non-GAAP EPS guidance for the June quarter at $0.34-$0.38, short of the previous estimates. The EPS estimates for FY07 and FY08 have been reduced from $1.61 to $1.45 and from $2.52 to $1.94, respectively.

[la-onda]

wow
Michael, whats your opinion??

Chinese Seek to Buy a U.S. Maker of Disk Drives
By JOHN MARKOFF

SAN FRANCISCO, Aug. 24 — A Chinese technology company has expressed interest in buying a maker of computer disk drives in the United States, raising concerns among American government officials about the risks to national security in transferring high technology to China. The overture, which was disclosed by the chief executive of one of the two remaining drive makers in the United States, William D. Watkins of Seagate Technology, has resurrected the issues of economic competitiveness and national security raised three years ago when Lenovo, a Chinese computer maker, bought I.B.M.'s personal computer business.

Tensions have been increasing lately between the countries over China's ambitions in developing its military abilities and advanced technologies for industrial and consumer uses.
Although disk drives do not fall under a list of export-controlled technologies, the attempted purchase of an American disk drive company would require a security review by the federal government, according to several government officials.
In recent years, modern disk drives, used to store vast quantities of digital information securely, have become complex computing systems, complete with hundreds of thousands of lines of software that are used to ensure the integrity of data and to offer data encryption.
That could raise the prospect of secret tampering with hardware or software to make it possible to pilfer information via computer networks, intelligence officials have warned.

Seagate has recently begun selling drives with hardware encryption abilities.

Mr. Watkins did not identify the Chinese company. But he said that the possibility of an acquisition had sent alarm bells ringing at some government agencies.

"The U.S. government is freaking out," Mr. Watkins said during an interview on Thursday.

Reached Friday night, Treasury officials declined to comment on possible Chinese overtures for an American maker.

While Mr. Watkins said that Seagate, which is the largest drive maker in the United States, was not for sale, he also said that if a high enough premium was offered to shareholders it would be difficult to stop.

Seagate's shares rose 1.05 percent Friday to close at $24.96 and were up about 4 percent for the week after news that it might enter the flash memory market. There does not appear to have been any significant increase in trading of Seagate options.

With a booming economy and $1.33 trillion in foreign-exchange reserves, Chinese companies are in a position to acquire American companies, as Japanese and West European companies were several decades ago. While those earlier acquisitions were often opposed out of fears that they would damage American economic competitiveness, the acquisition of American companies by Chinese companies is regarded with more suspicion, particularly in the high-tech sector.

Since the Lenovo sale, the government has become increasingly concerned about technology security, according to members of federal advisory committees.

"Seagate would be extremely sensitive," said an industry executive who participates in classified government advisory groups. "I do not think anyone in the U.S. wants the Chinese to have access to the controller chips for a disk drive. One never knows what the Chinese could do to instrument the drive."

The transfer of advanced disk drive manufacturing technology would give the Chinese a major leg up in competing in information technologies. China, however, still lags in basic manufacturing skills like semiconductor design and manufacturing.

"This is clearly a critical component of a computer system and the purchase by the Chinese or other nations merits a full review to determine what our risks are," said Michael R. Wessell, a commissioner of the U.S.-China Economic and Security Review Commission, a group that monitors the national security implications of trade with China for Congress.

I.B.M., which invented the disk drive in the 1950s and which dominated the industry through the 1990s, sold its disk drive business to the Japanese computer maker Hitachi in 2002, leaving just two American companies: Seagate, based in Scotts Valley, Calif., and Western Digital, based in Lake Forest, Calif.

Two other Japanese makers, Fujitsu and Toshiba, and a division of Samsung, a South Korean electronics conglomerate, are also major manufacturers of the storage devices.

Western Digital executives declined to comment.

Kenneth Lieberthal, the senior director for Asia at the National Security Council during the later years of the Clinton administration, expressed strong doubt that the Chinese government would allow a technology company to pursue an acquisition if the transaction were likely to draw criticism from the United States government, even if that criticism did not reach the level of an actual prohibition on a deal.

"The Chinese have been very concerned about how to invest in the United States without producing the kind of political firestorm they ran into when they tried to buy Unocal," said Mr. Lieberthal, a professor of politics and business administration at the University of Michigan. "The government really does not want to confront the kind of situation it ran into with Unocal."

The China National Offshore Oil Corporation, a state-owned company, abandoned its plan to buy Unocal in 2005 when it touched off opposition in Congress. Mr. Lieberthal said that the Chinese government had only been lukewarm about supporting Cnooc, and was likely to be even more cautious now. "If' they've really decided to go after a high-end computer equipment manufacturer, they've really decided to test the waters," he said.

If a Chinese company has made an advance to an American company in a technologically sensitive industry without obtaining prior support from the Chinese government, the Chinese company would be in serious trouble with Beijing officials, Mr. Lieberthal said. So it is unlikely that any serious approach would be made by a Chinese company without careful prior consultations in Beijing. Yet the Chinese government also faces a quandary: how to improve yields on its foreign exchange reserves, more than two-thirds of it in dollars. Roughly $100 billion is believed to be in American mortgage-backed securities, an investment that has suffered during the recent financial turmoil. A Chinese government investment fund spent $3 billion to buy nearly 10 percent of the Blackstone Group this summer, but made a point of taking nonvoting shares to reduce the risk of a political backlash. Stakes in financial services companies also tend to be less controversial than stakes in high-tech enterprises.
Beijing authorities are also starting to encourage companies and even individuals to invest more overseas, as a way to offset some of the foreign investment pouring into China. The inflow of money from investment and trade surpluses has been putting upward pressure on the value of China's currency, threatening to erode some of the competitiveness of Chinese exports. If a Chinese company does make an actual bid for an American high-tech company, a former government official said, and that bid is blocked for political reasons, then Chinese companies may become even warier of investing in American companies and the government in Beijing may begin to suspect that Washington so distrusts China that it is trying to throw roadblocks in the path of its economic development.

"If they are blocked, I would suspect this would at a minimum contribute to their being gun-shy of the U.S. government," said Mr. Lieberthal, a Chinese speaker who stays in close touch with a range of Chinese government officials and American corporate leaders.

http://www.nytimes.com/2007/08/25/business/worldbusiness/25drive.html?_r=1&oref=slogin

[la-onda]

Seagate Technology Updates Fiscal First Quarter 2008 Outlook
Tuesday , August 28, 2007 16:11ET

SCOTTS VALLEY, Calif., Aug. 28, 2007 (Canada NewsWire via COMTEX) --

Raising revenue, gross margin and earnings outlook for the September Quarter
Seagate Technology (NYSE: STX) today provided an update of its expected results for the fiscal first quarter 2008 which ends September 28, 2007. The company now expects revenue of $3.15 - $3.25 billion, GAAP diluted earnings per share of $0.57 - $0.61 and non-GAAP diluted earnings per share, which excludes $27 million of purchased intangibles amortization and other charges associated with the Maxtor and EVault acquisitions, of $0.62 - $0.66.

The company's original outlook for the first fiscal quarter was for revenue of $2.9 - $3.0, GAAP diluted earnings per share of $0.35 - $0.39 and non-GAAP diluted earnings per share, which excludes $27 million of purchased intangibles amortization and other charges associated with the Maxtor and EVault acquisitions, of $0.40 - $0.44.

The primary factors leading to the improved outlook for the first fiscal quarter are [1] industry unit demand at the high-end of the predicted range; [2] favorable pricing thus far in the quarter reflecting a more balanced supply and demand environment, and [3] a better product mix.

Gross margin is expected to expand to approximately 24% due to the demand, pricing and product mix factors referenced above. Operating expenses (R&D and SG&A) are expected to increase above the company's previous outlook due to higher variable compensation costs. The revised outlook assumes a 6% tax rate and diluted shares outstanding of 555 million.

Given the typical shipment profile for a September quarter and the dynamic nature of the demand and pricing environment, actual results during the balance of the quarter will heavily influence the company's financial performance for the quarter.

[la-onda]

fyi:

Seagate Technology "sector perform," target price raised
Wednesday, August 29, 2007 10:29:43 AM ET
RBC Capital Markets
NEW YORK, August 29 (newratings.com) - Analysts at RBC Capital Markets reiterate their "sector perform" rating on Seagate Technology (STX.NYS). The target price has been raised from $24 to $25.
&
Seagate Technology "overweight," target price raised
Wednesday, August 29, 2007 10:33:56 AM ET
Lehman Brothers
NEW YORK, August 29 (newratings.com) - Analysts at Lehman Brothers reiterate their "overweight" rating on Seagate Technology (STX.NYS). The target price has been raised from $27 to $29.
&
Seagate Technology "buy," target price raised
Wednesday, August 29, 2007 10:08:43 AM ET
Brean Murray, Carret & Co
NEW YORK, August 29 (newratings.com) - Analysts at Brean Murray reiterate their "buy" rating on Seagate Technology (STX.NYS). The target price has been raised from $28 to $34.
&
Seagate Technology "above average," target price raised
Wednesday, August 29, 2007 9:57:11 AM ET
Caris & Company
NEW YORK, August 29 (newratings.com) - Analysts at Caris & Company reiterate their "above average" rating on Seagate Technology (STX.NYS). The target price has been raised from $25 to $30.
&
Seagate Technology "buy," target price raised
Wednesday, August 29, 2007 9:29:27 AM ET
Needham & Co
NEW YORK, August 29 (newratings.com) - Analysts at Needham & Co reiterate their "buy" rating on Seagate Technology (STX.NYS). The target price has been raised from $29 to $33.

chart

[la-onda]

more detailed 

Seagate Technology "outperform," estimates raised

Wednesday, August 29, 2007 4:22:55 PM ET
Credit Suisse

NEW YORK, August 29 (newratings.com) – Analysts at Credit Suisse reiterate their "outperform" rating on Seagate Technology (STX.NYS), while raising their estimates for the company. The target price is set to $28.

In a research note published this morning, the analysts mention that the company has raised its revenue and pro forma EPS guidance for F1Q08 from $2.9-$3.0 billion to $3.15-$3.25 billion and from $0.42-$0.44 to $0.62-$0.66, respectively. The upside was driven by improved industry demand and a favourable pricing and product mix, the analysts say. Seagate Technology has issued its gross margin guidance at 24%, ahead of the estimates. The EPS estimate for FY08 from $1.91 to $2.06.


&

Seagate Technology "sector perform," target price raised - update

Wednesday, August 29, 2007 3:17:45 PM ET
RBC Capital Markets

NEW YORK, August 29 (newratings.com) – Analysts at RBC Capital Markets reiterate their "sector perform" rating on Seagate Technology (STX.NYS), while raising their estimates for the company. The target price has been raised from $24 to $25

In a research note published this morning, the analysts mention that the company has raised its F1Q08 revenues and non-GAAP EPS from $2.90-$3.00 billion to $3.15-$3.25 billion and from $0.42-$0.44 to $0.62-$0.66, respectively. Seagate Technology's guidance for the quarter is ahead of expectations, driven by improved pricing, robust unit demand and a favorable product mix, the analysts say. The EPS estimates for FY08 and FY09 have been raised from $12.1 to $12.9 and from $12.5 to $13.3, respectively.


&

Seagate Technology "overweight," target price raised - update

Wednesday, August 29, 2007 2:24:34 PM ET
Lehman Brothers

NEW YORK, August 29 (newratings.com) - Analyst Harry E Blount of Lehman Brothers reiterates his "overweight" rating on Seagate Technology (STX.NYS), while raising his estimates for the company. The target price has been raised from $27 to $29.

In a research note published this morning, the analyst mentions that the company has preannounced its results for the September quarter significantly ahead of the consensus. Seagate Technology's results were boosted by the back-to-school season, better-than-anticipated pricing trends, higher-than-expected share gains in industry unit demand and better-than-normal seasonality in Europe, the analyst says. The EPS estimate for 2008 has been raised from $1.80 to $2.41.

Michael, any comments from your side??
cheers
Oliver