Barclays analyst Ben Reitzes today trimmed his hard-drive unit growth forecast for 2010 to 22%, from 24% – and likewise slicing his EPS estimates for both Western Digital (WDC) and Seagate (STX).
Reitzes writes in a research note that “checks continue to indicate that HDD demand for Q2 is coming in at the low end of our expectations” due mostly to disappointing shipments for 2.5 inch notebook drives. He adds that checks within distribution and the supply chain “point toward slightly lower pricing” sequentially than he had previously modeled.
- For WDC, he maintains an Equal Weight rating, but cuts his target to $36, from $44. He trims his June 2010 fiscal year EPS estimate to $6.21, from $6.30; for FY 2011, he goes to $5.90, from $6.30.
- For STX, he maintains an Overweight rating, but cuts his target to $20, from $26. For the June 2010 fiscal year, he now sees EPS of $3.39, down from $3.49; for FY 2011, he goes to $3.28, from $3.73.
In today’s trading, however, the stocks are rising:
- WDC is up 63 cents, or 2%, to $32.09.
- STX is up 24 cents, or 1.8%, to $13.90.
Yesterday: Drive Stocks Stumble As Price Declines Reportedly Accelerate
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