MAXTOR STEPS AHEAD OF GAINS BY PEERS
By Chris Kraeuter, CBS.MarketWatch.com
Last Update: 10:09 AM ET Nov. 24, 2003
SAN FRANCISCO (CBS.MW) - Hardware and chips stocks, led by data storage company Maxtor, followed the broader market higher on Monday.
Maxtor leads peer gains
The Goldman Sachs Hardware Index ($GHA: news, chart, profile) added 2.1 percent and the Philadelphia Semiconductor Index ($SOX: news, chart, profile) added 1.7 percent.
Maxtor (MXO: news, chart, profile) jumped ahead of peer stocks with a gain of 4.7 percent to $11.10. Maxtor raised prices in the distribution channel for its hard disk drives, according to Bear Stearns analyst Naveen Bobba.
"By raising distribution channel prices, Maxtor is signaling its intentions to keep production/supply levels reasonable going into the seasonally slower first quarter," Bobba told clients on Monday.
He said it isn't clear yet whether or not Seagate and Western Digital will follow with their own increases.
"If the other major vendors follow suit some of the concerns and risks about more aggressive pricing conditions going into the seasonally slower first quarter could ease. If they don't, Maxtor risks losing share."
Western Digital (WDC: news, chart, profile) shares rose 2.3 percent to $12.07. Seagate (STX: news, chart, profile) gained 2.7 percent to $19.51.
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