TLDR
- Seagate stock gained 2.64% after Wells Fargo upgraded STX to Overweight Friday.
- Wells Fargo raised Seagate’s price target to $1,100 from the previous $900.
- Seagate’s annual earnings could climb to $53.69 per share by the year 2028.
- AI data growth continues to support demand for high-capacity HDD storage systems.
- Seagate has allocated most production capacity through contracts into 2027.
Seagate Technology (STX) shares rose 2.64% to $913.55 on Friday after Wells Fargo upgraded the data storage company. The stock recovered from early weakness and traded near its intraday highs during the afternoon session. The upgrade strengthened attention on Seagate’s earnings outlook and sustained demand from artificial intelligence infrastructure.
Seagate Technology Holdings plc, STX
Wells Fargo Raises Seagate Rating and Price Target
Wells Fargo analyst Aaron Rakers upgraded Seagate from Equal Weight to Overweight after the recent market pullback. He also raised the firm’s price target to $1,100 from $900. The revised target reflects stronger confidence in Seagate’s long-term earnings power and capital return capacity.
Rakers expects Seagate’s annual earnings per share to rise from $21.60 this year to $53.69 by 2028. He also increased estimates for Seagate and Western Digital before their June-quarter earnings reports. Meanwhile, Wells Fargo lifted Western Digital’s price target to $730 from $575.
The analyst expects both companies to report longer demand visibility through customer purchase agreements. Those contracts could support stable production planning and stronger pricing across the hard-disk drive market. Seagate and Western Digital produce most hard-disk drives used across large data centers.
AI Infrastructure Supports Hard-Disk Drive Demand
Artificial intelligence infrastructure continues to create demand for large and cost-efficient data storage systems. Cloud providers need more capacity as applications generate larger datasets and require longer retention periods. Consequently, hard-disk drives remain important for storing historical information at lower costs.
Seagate said the three largest cloud providers nearly doubled their remaining performance obligations to $1.1 trillion. Those commitments reflect broader spending plans for cloud services, data centers, and artificial intelligence infrastructure. Seagate expects this contracted pipeline to support demand for high-capacity storage products.
The company also reported progress with its Mozaic platform and heat-assisted magnetic recording technology. Seagate shipped 3TB-per-disk HAMR drives to its first cloud customer during 2025. That technology increases storage density while improving energy efficiency across large data-center systems.
Seagate Expands Revenue Outlook and Capacity Visibility
Seagate raised its annual revenue growth outlook to at least 20% as storage demand remained firm. Nearline products now account for about 90% of the company’s exabyte shipments. These products serve major cloud providers and large-scale data-center operators.
The company has allocated most production capacity through 2027 under long-term supply agreements and build-to-order contracts. Those arrangements give Seagate clearer demand visibility and support value-based pricing across its product range. They also reduce exposure to short-term changes in customer orders.
Seagate shares remain more than 500% higher over the past 12 months despite their recent pullback. Western Digital shares have gained nearly 800% during the same period. However, Friday’s upgrade shifted attention toward earnings growth, contracted demand, and Seagate’s storage technology roadmap.
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