Stock gets downgraded along with two others. IACI is selling at 11.7x out-year EPS. The other two downgrades are selling at 20x. The IACI sell off is just as bad? Also, were estimates cut by the analyst?
Management should provide unambiguous guidance for all to hear. If they do this, there wouldn't be such violent reactions. This is not the first time this has happened.
The Chinese have been continually interested in acquiring oil properties. Any reason why they would not be allowed to acquire Total? They want the commodity and investors could also seemingly justify a large premium considering the tax potential improvement.
Continued skepticism as I said before. You are being a historian and not an analyst. The industry consolidation is unprecedented. Seagate's investor friendliness with this dividend payout is unprecedented. You will see the difference. The 3.5x multiple is loaded with skepticism. Each P/E multiple point increase will be $5 upside in stock.
In three months there will only be two real disk drive competitors. WDC's balance sheet will have far more debt, so it will not want a price war. The first whiff of earnings upside potential (STX management implying this mow monthly), + earnings stability, and giant cash flow/dividend increases, STX 3.5 P/E multiple is going a lot higher and stock will reflect best fundamentals industry has ever had. By the way, investor skepticism is great right now: that will change.
Biggest shortage in the industry's history; new product cycle; market share and margins expanding; shareholder friendly management (dividend); industry consolidation; 3.5x probable out year earnings, with estimates climbing fast; last not least, plenty of investor/analyst skepticism to reverse. Woe.
Market is forward looking. It won't care how things got from there to here, but it will care about here to there: watch the coming earnings revisions.
Seagate's ability to supply is linchpin of entire technology chain. Capacity utilization (1H CY 2012)will surge in this fixed cost biz, leading to higher margins and accelerating earnings. Hold ratings will look ridiculous when estimates are being revised upward by 100%.
$18 billion in revenue at greater than 12% (could prove conservative). $5 + earnings power potential. Competition's fix of head technology problems is very difficult, not just a matter of supply/new machinery. Learning curve effects could be longer lasting than expected.
Timely downgrade by this guy this week ahead of this giant run up. What credibility does he have now?
This company has earning potential of $3.00 EPS in CY 2012. Share gains and significant acceleration in fundamentals should capture investor attention here. $17 upside, $1 downside? with 6% dividend yield too. Have not seen this story this good in more than a decade.