Barclays Upgrades Seagate Technology Stock on Improving Demand

The equity sports affordably priced premiums at the moment

Digital Content Manager
Jun 30, 2021 at 10:22 AM
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The shares of Seagate Technology Holdings PLC (NASDAQ:STX) are up 0.7% at $88.26 at last check, after the equity earned an upgrade from Barclays to "equal weight" from "underweight." The analyst in coverage noted market demand is improving for the data storage concern, especially in mobile computing. Barclays did add that continued material overhang in "Huawei sales, fading crypto exposure, and large shareholder selling" is to be expected.

Analysts were mostly optimistic towards Seagate Technology stock coming into today, with 11 of the 20 in question sporting a "strong buy" rating, while nine carried a tepid "hold" or worse. Plus, the 12-month consensus target price of $102.90 is a 16.9% premium to its current perch.

The options pits echo that bullish sentiment. This is per the stock's Schaeffer's put/call volume ratio (SOIR) of 0.48, which stands in the relatively low 9th percentile of its 12-month range, meaning short-term options traders have rarely been more call-biased. 

Now may be the right time to speculate on STX's next move higher with calls. The equity's Schaeffer's Volatility Index (SVI) of 31% stands in the 12th percentile of readings in its annual range, indicating options players are pricing in low volatility expectations at the moment.

The security has pulled back some since its May 17 all-time high of $106.22. The shares have since bounced off the $84 level, however, while support at the 100-day moving average also helped contain this pullback. Longer term, Seagate Technology stock sports a strong 82% year-over-year lead. 

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