Morgan Stanley Upgrades Seagate Technology (STX) to Overweight and Raises Price Target to $115 Per Share

The Surge in Seagate Technology Stock Price Today

Seagate Technology (STX) stock is experiencing a significant increase in its share price today, with a 9% rise as of 3 p.m. ET. This growth is attributed to a note published by Morgan Stanley this morning, which has upgraded its rating on Seagate from equal weight to overweight. The analysts have also raised their one-year price target on Seagate stock from $73 per share to $115 per share.

Despite the 56% increase in the last year, Seagate stock is still down about 17% from its high. However, Morgan Stanley’s coverage suggests that they believe the storage hardware specialist will reach a new peak valuation in the near future. The firm predicts that Seagate will benefit from the recovery in the data storage market and its position in HAMR technologies, which will lead to stronger sales and earnings performance. Furthermore, they anticipate that demand related to the rise of generative AI will be a significant performance driver.

With the data storage industry on an upswing and AI-related demand growing, Seagate’s profitability could see substantial improvements. Morgan Stanley’s analysts believe that Seagate’s earnings performance in the near term could exceed expectations by 25% to 30%. Additionally, the connection to the AI revolution may result in investors assigning higher valuation multiples to Seagate and other data storage stocks.

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