Bank of America and Morgan Stanley raised their price targets on STX ahead of the results.

  • Analysts expect Seagate’s Q1 revenue to rise 58% to $4.15 billion, the highest pace of growth on record, as per Koyfin.
  • STX stock dropped over 30% so far in October but remains 135% higher year-to-date.
  • Stocktwits retail sentiment for STX was ‘bearish’ on Tuesday.

Seagate Technology (STX) stock rose 0.4% in premarket trading on Tuesday, buoyed amid a boost in sentiment for memory stocks after Anthropic made its financials and purchase commitments public.

Investors now turn to the hard disk drive maker’s fiscal Q1 results, due after the markets close. Analysts expect revenue to rise 58% to $4.15 billion, the highest pace of growth on record, and adjusted profit to increase 185% to $7.43 per share, per Koyfin.

The results come amid a broad-based selloff in chip stocks, driven by fresh concerns about the durability of AI-linked spending by top organizations. STX shares have dropped over 30% so far in October but remain 135% higher year-to-date.

Peer Western Digital (WDC) reported upbeat results last week, but its shares dropped nonetheless. In fact, CEO Irving Tan said Western Digital had visibility into storage demand from biggest customers through 2030 and 2031.

Analysts See Upside

Last week, Bank of America raised its price target on STX to $1,200 from $1,150 and kept a ‘Buy’ rating, and Morgan Stanley raised its target on Seagate to $1,200 from $1,187, also keeping an ‘Overweight’ rating.

Morgan Stanley reinstated Seagate on its "Top Picks" list, and its checks point to strengthening hard disk drive fundamentals amid a broadening customer base.

Analysts and investors would broadly focus on Seagate’s outlook for data-center storage demand, pricing, and margins, alongside the ramp-up of its Mozaic HAMR drives, a new technology that packs more storage. 

Retail View On STX

On Stocktwits, the retail sentiment for STX was ‘bearish,’ unchanged over the past week. 

“$STX looks like we will catch a break with KOSPI up 4% today. With a green day and earnings tonight we may reclaim that 7 handle and bring $WDC along with us. Buckle up folks. This is what we’ve been waiting for,” said a trader. 

Anthropic made its S-1 filing public on Monday, showing sharp gains in sales in the first half of the year, which boosted sentiment for the AI infrastructure sector. Memory stocks and South Korea’s benchmark Kospi rose on Tuesday.

Another trader wrote: “$WDC $STX if you are holding in cash, stay put, we will recover when this is over.”

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