Recent Western Digital Weakness A Buying Opportunity: Benchmark – Barron’s (blog)


Benchmark’s Mark Miller is out defending Western Digital (WDC) after recent weakness Friday, writing that the selloff is a buying opportunity.

Both Western Digital and Seagate (STX) presented at an investor conference where one source said a modest pause in cloud demand is expected in the first half of the year, with demand accelerating in the back half of 2017.

Miller writes that the commentary has been misinterpreted: Seagate CFO Dave Morton said cloud demand has been persistent and growth signals strong, but said the nature of the business means lumpy quarter-to-quarter growth. When asked about reports that Intel (INTC) and Hewlett-Packard (HPQ) are seeing weakness in the traditional data center and server markets, Western Digital President and COO Mike Cordano said his firm is still projecting a “solid” 40% annual growth in cloud sales.

Miller also writes that Micron (MU) projected tight supply through 2018 at  its recent Investor meeting. He concludes:

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