Seagate Stock Falls Despite Earnings Ahead Of Views

Seagate Technology (STX) stock fell late Tuesday, despite the data storage company posting fiscal first quarter earnings and sales that exceeded expectations. The disk-drive manufacturer’s guidance for current quarter revenue was also in-line with projections from analysts.

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Seagate said it earned an adjusted $1.58 per share on sales of $2.17 billion for the September-ended quarter. Analysts polled by FactSet projected Seagate would post adjusted earnings of $1.48 per share on sales of $2.13 billion.

“Seagate is off to an outstanding start to the fiscal year, highlighted by gross margin expanding to the highest level in more than a decade,” said Seagate Chief Executive Dave Mosley in a news release.

For the same period a year earlier, the Fremont, Calif.-based Seagate posted an adjusted loss of 22 cents per share on sales of $1.45 billion.

For the current quarter, Seagate guided for sales of $2.3 billion at the midpoint of its range. That was in-line with what analysts were previously projecting Seagate would post for the December-ending quarter, according to FactSet.

On the stock market today, Seagate stock is down more than 2% at 110 in recent after-hours action.

Seagate Stock: Technical Ratings

Seagate is the world’s largest manufacturer of hard disk drives. Seagate’s stock struggled in 2022 and for the first half of last year, amid a hard drive supply glut and slowing demand from PC makers. Demand from datacenters and excitement about AI has helped the stock bounce back. Shares are ahead 35% this year and nearing an all-time high above 116 that Seagate reached near the start of 2022.

Prior to earnings, Seagate stock gained a fraction to close at 112.64 in regular Tuesday trading.

Coming into the report, Seagate stock had an IBD Composite Rating of 79 out of a best-possible 99, according to IBD Stock Checkup. The score combines five separate proprietary ratings into one rating. The best growth stocks have a Composite Rating of 90 or better.

Further, Seagate’s Relative Strength Rating was 87 out of 99. The RS Rating means that Seagate has outperformed 87% of all stocks in IBD’s database over the past year.

Before earnings, Seagate stock was trading within a 5% buy zone above a 110.93 cup-with-handle buy point, according to MarketSurge. The stock broke out from the pattern on Oct. 14.

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