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Seagate - AI Stock Analysis

Analysis generated June 28, 2024

Seagate Technology Holdings PLC is a leading provider of storage solutions, including hard disk drives (HDDs), solid state drives (SSDs), and data recovery services. The company has driven innovation in data storage for over 40 years and continues to play a significant role in the hardware component industry. The company’s products are widely used in data centers, enterprise server environments, and personal computing.

Fundamental Analysis

Seagate’s revenue for the last quarter was reported at $1.57 billion, reflecting a 6.93% increase compared to the prior quarter. This near-term growth indicates positive momentum. However, the revenue shows a decrease of 11.73% compared to the same quarter last year, which could reflect broader challenges in the industry or company-specific issues.

Net income for the last quarter was reported at $25 million, which is a significant improvement, displaying a 231.58% increase quarter-over-quarter and a 105.77% increase year-over-year. This improvement in profitability is a strong indicator of operational efficiency or expense management.

The EBITDA for the last quarter was $217 million, marking a 95.50% increase compared to the previous quarter, and a 75.00% increase year-over-year. These figures suggest that Seagate is operating more efficiently, creating higher operational earnings.

Currently, Seagate’s Price-to-Earnings (P/E) ratio stands at 22.13. This value is within a normal range, suggesting that the market does not view the stock as significantly overvalued or undervalued based on earnings. However, insider selling over the last couple of months serves as a potentially bearish signal, indicating that internal executives may be uncertain about future stock performance.

Technical Analysis

Today’s stock price for Seagate is $104.06, reflecting an 8.19% increase compared to one month ago and a substantial 73.84% increase compared to one year ago. These short-term and long-term price movements indicate positive momentum overall.

However, the trend appears to be turning bearish. The current 10-day Simple Moving Average (SMA10) is 103.51, which is slightly lower than the previous SMA10 of 103.63. This suggests potential downward movement in the stock price going forward. The Relative Strength Index (RSI) is 51, which implies a neutral market condition, neither overbought nor oversold.

Alternative Data Analysis

Looking at job postings and employee sentiment, Seagate has 154 open positions, down by 43% in the last couple of months. This significant decrease suggests that the company might be focusing on cost-cutting measures, a concerning sign for long-term growth.

In terms of customer acquisition, Seagate’s estimated 1.9 million visitors to their webpage are down by 21% in recent months. This decline in web traffic could indicate a potential loss of customer interest and a challenge in maintaining or growing market share.

Customer engagement metrics show that Seagate has 130,000 followers on their Instagram page, down by 1%, and 190,000 followers on their Twitter page, stable with a 0% change in recent months. Although the change in follower count may seem minimal, any decline or stagnation in user engagement can be a red flag.

According to AltIndex’s AI score, which evaluates a company’s stock price using fundamental, technical, and alternative data analysis, Seagate has an AI score of 28. This is a strong sell signal, stressing caution for potential investors.

Conclusion

Seagate exhibits a mixed performance based on the various types of analysis conducted. Fundamentally, the company shows positive growth in profits and operating efficiencies, but revenue decline year-over-year and insider selling raise concerns. Technically, while the stock price has increased significantly, signals suggest potential bearish behavior in the near term. Alternative data reveals a concerning trend in job reductions, declining web traffic, and slight decreases in customer engagement.

Given these varying indicators, it’s prudent to heed the strong sell signal from AltIndex’s AI score of 28. While Seagate demonstrates short-term and operational positives, the overarching signals caution against strong investment at this stage. Our recommendation would be to take a cautious stance, monitor ongoing performance closely, and consider potential headwinds before making investment decisions in Seagate stock.

Disclaimer: This AI stock analysis, generated by an experimental AI tool, is for informational purposes only and not financial advice. Information is based on publicly available data and may not always be accurate or current.