Seagate (STX) & Phison Collaborate to Advance SSD Development
Seagate Technology Holdings plc STX recently collaborated with Phison Electronics Corp to advance the development and distribution of enterprise-class NVMe solid-state drives (or SSDs) with focus on enhanced performance and efficiency. The companies will be providing more details regarding the same in the summer of 2022.
Seagate added that the new SSDs would reduce the cost of total cost ownership (TCO) business enterprises by providing higher storage density, lower power consumption and higher performance. These new SSDs will be designed to complement hard disk drive storage and allow to run applications like AI, hyperscale data centers and high-performance computing.
Since 2017, the two companies have been working on advancing Seagate’s mainstream SATA SSD products. Phison Electronics specializes in designing and manufacturing of NAND flash controller and storage solutions.
Opportunities in SSD Space Bodes Well
Seagate and other prominent storage players are rapidly expanding into the SSD storage market. SSDs are faster and more energy efficient and occupy less space. SSDs are more suitable for mobile computing devices. The emergence of thinner laptops and tablets over the past few years has created an ideal market for SSDs.
Seagate Technology Holdings PLC Price and Consensus
Seagate Technology Holdings PLC price-consensus-chart | Seagate Technology Holdings PLC Quote
Apart from exponential growth in digital data and increasing penetration of high-end cloud platforms, SSD demand is driven by increased usage in connected car applications. These applications require better storage, high-quality graphics and communications, which the SSDs fulfil. SSDs are increasingly being leveraged by data centers, owing to the reduction in latency, which facilitates faster response to real-time applications.
In the last reported quarter, the company reported non-GAAP revenues of $3.116 billion, improving 19% on a year-over-year basis but unchanged sequentially. Robust demand for its mass capacity storage solutions, especially nearline products from cloud data center customers, boosted the top line.
However, supply-chain constraints, component shortages and logistics bottlenecks are concerns. Higher freight costs and stiff competition in the disk drive market remain near-term headwinds.
At present, Seagate carries a Zacks Rank #4 (Sell). Shares of STX have gained 7.6% against the industry’s fall of 61.7% in the past year.
Key Picks
Some better-ranked stocks from the broader technology sector are Broadcom AVGO, Apple AAPL and Arrow Electronics ARW. All stocks carry a Zacks Rank of 2 (Buy) at present. You can see the complete list of today’s Zacks #1 (Strong Buy) Rank stocks here.
The Zacks Consensus Estimate for Broadcom’s fiscal 2022 earnings is pegged at $35.49 per share, up 7.4% in the past 60 days. AVGO’s long-term earnings growth rate is pegged at 14.5%.
Broadcom’s earnings beat the Zacks Consensus Estimate in all the preceding four quarters, with the average being 1.9%. Shares of AVGO have increased 24% in the past year.
The Zacks Consensus Estimate for Apple’s fiscal 2022 earnings is pegged at $6.16 per share, up 0.2% in the past 60 days. The long-term earnings growth rate is pegged at 12.5%.
Apple’s earnings beat the Zacks Consensus Estimate in each of the last four quarters, with the average being 20.3%. Shares of AAPL have rallied 31.8% in the past year.
The Zacks Consensus Estimate for Arrow Electronics 2022 earnings is pegged at $18.48 per share, up 4.5% in the past 60 days. The long-term earnings growth rate is 3.1%.
Arrow Electronics’ earnings beat the Zacks Consensus Estimate in each of the last four quarters, with the average being 19.1%. Shares of ARW have lost 2.3% in the past year.
Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report
Apple Inc. (AAPL) : Free Stock Analysis Report
Seagate Technology Holdings PLC (STX) : Free Stock Analysis Report
Arrow Electronics, Inc. (ARW) : Free Stock Analysis Report
Broadcom Inc. (AVGO) : Free Stock Analysis Report
To read this article on Zacks.com click here.
Zacks Investment Research
