Seagate Technology Holdings PLC (STX) Raises Target Price Amid Strong Market Indicators

Seagate Technology Holdings PLC's (STX) Q1 earnings beat expectations, with revenue up 31% YoY and non-GAAP gross profit doubling YoY. Citi analyst Asiya Merchant raised the price target from $140 to $170 and maintained a Buy rating, citing strong market indicators and robust demand for hard disk drives. The average target price is $124.02, with a high estimate of $170.00 and a low estimate of $68.00.

Seagate Technology Holdings PLC (STX) reported robust Q1 earnings, with revenue up 31% year-over-year (YoY) and non-GAAP gross profit doubling YoY. The company's strong performance was driven by increased demand for hard disk drives, as highlighted by Citi analyst Asiya Merchant, who raised the price target from $140 to $170 while maintaining a Buy rating [2]. The average target price among 20 analysts is $124.02, with a high estimate of $170.00 and a low estimate of $68.00 [2].

Seagate's Q1 revenue of $2.16 billion represented a 31% YoY increase, while non-GAAP gross profit grew by 81% to $781 million. The company's gross margin expanded for the eighth consecutive quarter, reaching the third highest operating margin in its history [2]. Mass capacity revenue increased by 48% YoY, while nearline shipments grew by 55% YoY [2].

Analysts attribute Seagate's growth to the robust demand for storage in data centers running artificial intelligence (AI) workloads. The company's 40% share of the global storage market positions it well to capitalize on this growth opportunity [1]. Seagate expects annual revenue for the data center storage market to reach $23 billion by 2028, up from $13 billion in 2024 [1].

Despite a 7% sequential decline in revenue due to temporary supply constraints, Seagate's Q1 performance underscores its strong fundamentals and growth prospects. The company is well-positioned to benefit from the ongoing build-out of data center infrastructure to support AI transformations [1].

References:
[1] https://www.fool.com/investing/2025/07/06/undervalued-and-profitable-this-artificial-intelli/
[2] https://www.gurufocus.com/news/2971486/seagate-stx-target-price-increased-amid-strong-market-indicators-stx-stock-news