Citi Reiterates Buy Rating On Seagate Technology

According to Citi, Seagate Technology STX cautious 2Q TAM outlook should not be a surprise. Citi reported that Seagate will report its full 3FQ11 results on April 19. “Recall that last week STX disclosed prelim results of $2.7B revenues, 49M HDD units, and gross margin at or “slightly above” 19%. Our modeling suggests that EPS could be at or above $0.33 (vs consensus $0.26) based on GM upside and lower share count. We estimate that the company purchased $600-700M in shares during the first two months of the quarter, or more than 10% of shares outstanding.” Seagate Technology closed yesterday at $17.64.