Shares of data storage manufacturer Seagate (NASDAQ:STX) fell 5.95% in the morning session after Barclays analyst Tom O'Malley downgraded the stock's rating from Overweight (Buy) to Equal Weight (Hold) and assigned a price target of $65. The analyst added, "The Nearline recovery continues to take longer than expected, with [the first-quarter of 2024] now our best case scenario for a material unit uptick,"
The stock market overreacts to news, and big price drops can present good opportunities to buy high-quality stocks. Is now the time to buy Seagate Technology? Access our full analysis report here, it's free.
What is the market telling us:
Seagate Technology's shares are somewhat volatile and over the last year have had 14 moves greater than 5%. In context of that, today's move is indicating the market considers this news meaningful but not something that would fundamentally change its perception of the business.
The biggest move we wrote about over the last year was five months ago, when the stock dropped 5.88% on the news that the company reported disappointing quarterly earnings for the quarter ended March 31. STX missed revenue and EPS estimates and also guided next quarter's revenue and EPS below Consensus. On an absolute basis, revenue growth and operating margins were quite weak.
Seagate Technology is up 23.2% since the beginning of the year, but at $63.97 per share it is still trading 13.2% below its 52-week high of $73.70 from August 2023. Investors who bought $1,000 worth of Seagate Technology's shares 5 years ago would now be looking at an investment worth $1,280.
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