Western Digital Corp. (WDC): Zacks Rank Buy

• By Michael Vodicka
• On 1:00 am EST, Monday November 2, 2009

Western Digital Corp. (NYSE: WDC - News) reported better than expected third-quarter results on Oct 21 on a 12% jump in shipments from a year ago.

Third-Quarter Results

Revenue was up 5% from last year to $2.1 billion. Earnings also came in strong at $1.25 per share, easily outpacing the Zacks Consensus Estimate of 90 cents. The company has beat in each of the last 4 quarters by an average of 31 cents, or 113%.

CEO John Coyne said that demand for the company's products is being fueled by the recent popularity surge in social media.

Estimates Up

Estimates have spike since the good quarter was reported, with the current year adding 49 cents and moving to $4.38 per share.

Valuation

Based on this earnings projection, shares of WDC trade with a P/E of 7.5X, a sharp discount to the overall market.

The Chart

Shares of WDC are up huge over the last 8 months but have recently traded mostly sideways near the 52-week high. Take a look below.

Last Week's Momentum Zacks Rank Buy Stocks

Helen of Troy Ltd. (NasdaqGS: HELE - News) posted better than expected second-quarter results on Oct 7, making it 3 consecutive quarters that the company has beat the Street. Read Full Article.

Lam Research Corp. (NasdaqGS: LRCX - News) recently reported better than expected third-quarter results that saw the company swing back into profitability after a couple tough quarters due to the volatile economy. Read Full Article.

Caterpillar, Inc. (NYSE: CAT - News) recently hit a new 52-week high after reporting better than expected third-quarter results on Oct 21. Read Full Article.

Apple, Inc. (NasdaqGS: AAPL - News) reported strong third-quarter results on Oct 20 that were better than expected, driven by the second highest quarterly revenue in the company's history.

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