NasdaqGS:STX

Stock Analysis Report

Executive Summary

Seagate Technology plc provides data storage technology and solutions in Singapore, the United States, the Netherlands, and internationally.

Rewards

Trading at 10.4% below its fair value

Earnings grew by 1.9% over the past year

Risk Analysis

Earnings are forecast to decline by an average of -0.7% per year for the next 3 years

Has a high level of debt

Unstable dividend track record



Snowflake Analysis

Proven track record average dividend payer.


Similar Companies

Samsung Electronics

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Share Price & News

How has Seagate Technology's share price performed over time and what events caused price changes?


Latest Share Price and Events

Stable Share Price: STX has not had significant price volatility in the past 3 months.


Market Performance


7 Day Return

-0.2%

STX

1.4%

US Tech

1.5%

US Market


1 Year Return

18.1%

STX

81.9%

US Tech

20.1%

US Market

Return vs Industry: STX underperformed the US Tech industry which returned 81.9% over the past year.

Return vs Market: STX underperformed the US Market which returned 20.1% over the past year.


Shareholder returns

STXIndustryMarket
7 Day-0.2%1.4%1.5%
30 Day-11.6%1.5%1.4%
90 Day-10.2%19.9%8.7%
1 Year24.2%18.1%84.6%81.9%22.7%20.1%
3 Year35.0%14.5%132.4%116.2%50.1%40.5%
5 Year15.5%-13.2%149.3%124.7%73.1%54.1%

Price Volatility Vs. Market

How volatile is Seagate Technology's share price compared to the market and industry in the last 5 years?


Simply Wall St News

Valuation

Is Seagate Technology undervalued compared to its fair value and its price relative to the market?

10.4%

Undervalued compared to fair value


Share Price vs. Fair Value

Below Fair Value: STX ($53.99) is trading below our estimate of fair value ($60.27)

Significantly Below Fair Value: STX is trading below fair value, but not by a significant amount.


Price To Earnings Ratio

PE vs Industry: STX is good value based on its PE Ratio (8.6x) compared to the Tech industry average (22.1x).

PE vs Market: STX is good value based on its PE Ratio (8.6x) compared to the US market (18.4x).


Price to Earnings Growth Ratio

PEG Ratio: STX's earnings are forecast to decline next year, so we can't calculate its PEG ratio.


Price to Book Ratio

PB vs Industry: STX is overvalued based on its PB Ratio (7.7x) compared to the US Tech industry average (1.8x).


Next Steps

Future Growth

How is Seagate Technology forecast to perform in the next 1 to 3 years based on estimates from 25 analysts?

-0.7%

Forecasted annual earnings growth


Earnings and Revenue Growth Forecasts


Analyst Future Growth Forecasts

Earnings vs Savings Rate: STX's earnings are forecast to decline over the next 3 years (-0.7% per year).

Earnings vs Market: STX's earnings are forecast to decline over the next 3 years (-0.7% per year).

High Growth Earnings: STX's earnings are forecast to decline over the next 3 years.

Revenue vs Market: STX's revenue is expected to decline over the next 3 years (-0.09% per year).

High Growth Revenue: STX's revenue is forecast to decline over the next 3 years (-0.09% per year).


Earnings per Share Growth Forecasts


Future Return on Equity

Future ROE: STX's Return on Equity is forecast to be very high in 3 years time (71.5%).


Next Steps

Past Performance

How has Seagate Technology performed over the past 5 years?

7.0%

Historical annual earnings growth


Earnings and Revenue History

Quality Earnings: STX has high quality earnings.

Growing Profit Margin: STX's current net profit margins (17%) are higher than last year (14.7%).


Past Earnings Growth Analysis

Earnings Trend: STX's earnings have grown by 7% per year over the past 5 years.

Accelerating Growth: STX's earnings growth over the past year (1.9%) is below its 5-year average (7% per year).

Earnings vs Industry: STX earnings growth over the past year (1.9%) exceeded the Tech industry 0.4%.


Return on Equity

High ROE: Whilst STX's Return on Equity (92.68%) is outstanding, this metric is skewed due to their high level of debt.


Return on Assets


Return on Capital Employed


Next Steps

Financial Health

How is Seagate Technology's financial position?


Financial Position Analysis

Short Term Liabilities: STX's short term assets ($4.2B) exceed its short term liabilities ($2.7B).

Long Term Liabilities: STX's short term assets ($4.2B) do not cover its long term liabilities ($4.4B).


Debt to Equity History and Analysis

Debt Level: STX's debt to equity ratio (226.3%) is considered high.

Reducing Debt: STX's debt to equity ratio has increased from 106.2% to 226.3% over the past 5 years.

Debt Coverage: STX's debt is well covered by operating cash flow (44%).

Interest Coverage: STX's interest payments on its debt are well covered by EBIT (7.4x coverage).


Balance Sheet

Inventory Level: STX has a high level of physical assets or inventory.

Debt Coverage by Assets: STX's debt is covered by short term assets (assets are 1x debt).


Next Steps

Dividend

What is Seagate Technology's current dividend yield, its reliability and sustainability?

4.81%

Current Dividend Yield


Upcoming Dividend Payment

Purchase Seagate Technology before the 'Buy Limit' to receive their next dividend payment.


Dividend Yield vs Market

company4.8%marketbottom25%1.4%markettop25%3.7%industryaverage1.1%forecastin3Years4.8%

Current dividend yield vs market & industry

Notable Dividend: STX's dividend (4.82%) is higher than the bottom 25% of dividend payers in the US market (1.44%).

High Dividend: STX's dividend (4.82%) is in the top 25% of dividend payers in the US market (3.69%)


Stability and Growth of Payments

Stable Dividend: Whilst dividend payments have been stable, STX has been paying a dividend for less than 10 years.

Growing Dividend: STX's dividend payments have increased, but the company has only paid a dividend for 9 years.


Current Payout to Shareholders

Dividend Coverage: With its reasonably low payout ratio (40.6%), STX's dividend payments are well covered by earnings.


Future Payout to Shareholders

Future Dividend Coverage: STX's dividends in 3 years are forecast to be well covered by earnings (46.5% payout ratio).


Next Steps

Management

How experienced are the management team and are they aligned to shareholders interests?

2.3yrs

Average management tenure


CEO

Dave Mosley (52yo)

2.3yrs

Tenure

US$10,344,579

Compensation

Dr. William David Mosley, also known as Dave, has been Chief Executive Officer of Seagate Technology Plc since October 1, 2017. Dr. Mosley served as President and Chief Operating Officer of Seagate Technol ...


CEO Compensation Analysis

Compensation vs Market: Dave's total compensation ($USD10.34M) is about average for companies of similar size in the US market ($USD10.81M).

Compensation vs Earnings: Dave's compensation has been consistent with company performance over the past year.


Leadership Team

NamePositionTenureCompensationOwnership
Stephen Luczo
Executive Chairman17.7yrsUS$569.20k0.27% $37.8m
William Mosley
CEO & Director2.3yrsUS$10.34m0.13% $18.1m
Gianluca Romano
Executive VP & CFO1.1yrsUS$2.98mno data
Jeffrey Nygaard
Executive VP0yrsUS$5.09m0.021% $3.0m
Katherine Schuelke
Senior VP2.7yrsUS$1.96m0.0048% $681.9k
Géraldine Hottier-Fayon
Interim Principal Accounting Officer1.5yrsno data0.0032% $443.8k
John Morris
Senior VP & CTO0yrsno datano data
Ravi Naik
Chief Information Officer2.6yrsno datano data
Shanye Hudson
Vice President of Investor Relations0yrsno datano data
Patricia Frost
Senior Vice President of Human Resources0yrsno datano data

2.3yrs

Average Tenure

53.5yo

Average Age

Experienced Management: STX's management team is considered experienced (2.3 years average tenure).


Board Members

NamePositionTenureCompensationOwnership
Stephen Luczo
Executive Chairman17.7yrsUS$569.20k0.27% $37.8m
William Mosley
CEO & Director2.3yrsUS$10.34m0.13% $18.1m
Edward Zander
Independent Director10.9yrsUS$327.47k0.018% $2.5m
William Coleman
Independent Director7.8yrsUS$302.44k0.0055% $772.1k
Michael Cannon
Lead Independent Director3.3yrsUS$357.47k0.012% $1.7m
Judy Bruner
Independent Director2.1yrsUS$332.74k0.0045% $638.2k
Mark Adams
Independent Director3.1yrsUS$312.47k0.0046% $646.7k
Jay Geldmacher
Independent Director7.8yrsUS$307.47k0.0028% $388.9k
Stephanie Tilenius
Independent Director6.1yrsUS$307.47k0.0076% $1.1m
Dylan Haggart
Independent Director2.1yrsUS$297.47k0.0013% $177.5k

4.7yrs

Average Tenure

61yo

Average Age

Experienced Board: STX's board of directors are considered experienced (4.7 years average tenure).


Ownership

Who are the major shareholders and have insiders been buying or selling?


Insider Trading Volume

Insider Buying: STX insiders have only sold shares in the past 3 months.


Recent Insider Transactions

Ownership Breakdown

Dilution of Shares: Shareholders have not been meaningfully diluted in the past year.


Top Shareholders

Company Information

Seagate Technology plc's company bio, employee growth, exchange listings and data sources


Key Information

  • Name: Seagate Technology plc
  • Ticker: STX
  • Exchange: NasdaqGS
  • Founded: 1979
  • Industry: Technology Hardware, Storage and Peripherals
  • Sector: Tech
  • Market Cap: US$14.089b
  • Shares outstanding: 260.96m
  • Website: https://www.seagate.com

Number of Employees


Location

  • Seagate Technology plc
  • 38/39 Fitzwilliam Square
  • Dublin
  • Co. Dublin
  • 2
  • Ireland

Listings

TickerExchangePrimary SecuritySecurity TypeCountryCurrencyListed on
STXNasdaqGS (Nasdaq Global Select)YesCommon SharesUSUSDDec 2002
STTDB (Deutsche Boerse AG)YesCommon SharesDEEURDec 2002
STXWBAG (Wiener Boerse AG)YesCommon SharesATEURDec 2002
0Y2ALSE (London Stock Exchange)YesCommon SharesGBUSDDec 2002
STTETLX (Eurotlx)YesCommon SharesITEURDec 2002
S1TX34BOVESPA (Bolsa de Valores de Sao Paulo)BDR EACH REPR 1 COMBRBRLDec 2019

Biography

Seagate Technology plc provides data storage technology and solutions in Singapore, the United States, the Netherlands, and internationally. The company manufactures and distributes hard disk drives; solid state drives (SSDs), including serial attached small computer system interface and non-volatile memory express SSDs; solid state hybrid drives; and storage subsystems. Its products are used in enterprise servers and storage systems; edge non-compute applications, such as various end user devices comprising portable external storage systems, surveillance systems, network-attached storages, digital video recorders, and gaming consoles; and edge compute applications primarily for desktop and mobile computing, as well as data centers. It also provides enterprise data solutions portfolio comprising storage subsystems for enterprises, cloud service providers, and scale-out storage servers and original equipment manufacturers (OEMs). In addition, the company offers external storage solutions under the Seagate Backup Plus and Expansion product lines, as well as under the LaCie and Maxtor brands in capacities up to 168TB. It sells its products primarily to OEMs, distributors, and retailers. The company was founded in 1979 and is headquartered in Dublin, Ireland. 


Company Analysis and Financial Data Status

All financial data provided by Standard & Poor's Capital IQ.
DataLast Updated (UTC time)
Company Analysis2020/02/16 23:48
End of Day Share Price2020/02/14 00:00
Earnings2020/01/03
Annual Earnings2019/06/28


Unless specified all financial data is based on a yearly period but updated quarterly. This is known as Trailing Twelve Month (TTM) or Last Twelve Month (LTM) Data. Learn more here.