Seagate Technology price target boosted by Bank of America ahead of quarterly report

The steadfast besides accrued its guardant estimates, projecting fiscal 2026 gross of $11.7 cardinal and net per stock of $13.65, up from anterior forecasts of $11.4 cardinal and $12.97. The higher valuation multiple—25 times estimated calendar 2027 earnings, versus 23 times previously—reflects expectations for continued borderline enlargement and affirmative semipermanent estimation revisions.

The analysts said they expect Seagate to study fiscal third-quarter gross of astir $3.02 cardinal and net per stock of $3.70 erstwhile it reports results aft marketplace adjacent connected April 28, some supra existent statement estimates. Strength successful information halfway request is anticipated to offset emblematic seasonal weakness successful borderline and IoT markets during the March quarter.

Growth successful unreality infrastructure and endeavor retention is expected to stay a cardinal driver. Analysts estimation Seagate shipped astir 186 exabytes of retention successful the quarter, including astir 1 cardinal heat-assisted magnetic signaling (HAMR) drives. For the afloat fiscal year, shipments of HAMR units are projected to scope astir 7 million.

Looking up to the fiscal 4th quarter, Bank of America forecasts gross of $3.2 cardinal and net per stock of $4.20, again supra consensus. Gross margins are expected to grow sequentially, reaching astir 47.3%, supported by pricing spot and outgo efficiencies tied to newer HAMR technologies.

The study highlights continued advancement successful HAMR adoption, with 2 customers having completed qualification of Seagate’s 40-terabyte drives. The modulation from accepted perpendicular magnetic signaling (PMR) to higher-capacity HAMR products is expected to enactment margins, with incremental margins projected to transcend the company’s semipermanent 50% target.

Analysts besides pointed to improved visibility from semipermanent contracts, noting that overmuch of Seagate’s nearline retention capableness for calendar 2026 is already covered by orders, with immoderate acquisition commitments extending into aboriginal 2027.