Morgan Stanley reiterated its bullish view on Western Digital and Seagate Technology, forecasting strong earnings and guidance in their upcoming reports. Analyst Erik Woodring sees more than 80% upside for both stocks from their October 19 closing prices.
The shares recently sold off amid broader volatility in the AI sector and concerns about competition from Toshiba. Woodring views the declines as a buying opportunity, citing checks that point to strengthening hard-disk drive (HDD) fundamentals.
Those checks indicate a broader customer base and accelerating prices, trends Woodring compares with the memory market a year earlier. Morgan Stanley named Seagate its top pick in IT hardware and raised its price target to $1,200. The firm lowered its target for Western Digital to $643, which still implies significant gains.