DJ Newswire - Disk Drive Cos. Rise Despite Western Digital Outlook
January 30, 1998 3:38 PM
NEW YORK (Dow Jones)--Despite a tepid outlook
from Western Digital Corp. (WDC), disk-drive stocks
moved up solidly Friday.
Western Digital, which Thursday reported operating
earnings of 3 cents a share, compared with an expected
loss of a penny a share, rose 1 3/16, or 7.2%, to 18
1/2. Volume of 5.3 million shares was more than double
the daily average of 2.6 million.
But analysts lowered their earnings estimates on the
stock, with many commenting that Western Digital
appears to be losing market share to Hyundai
Electronics Industries Co.'s Maxtor Corp.
The embattled disk-drive stocks charged up anyway,
aided by an analyst's upgrade of Seagate Technology
Inc. (SEG).
BancAmerica Robertson Stephens & Co. analyst
Patrick Tenney said he is recommending the stock as a
buy to bargain hunters.
He said Seagate has a lot of "unrecognized value" from
its software business, and the $200 million restructuring
plan underway at the company can only improve its
operations.
But he insisted he wasn't predicting the disk-drive
industry was on the verge of correcting its long-running
oversupply problem.
"I'm not making a hard-drive industry call - I don't know
if the industry has hit a bottom or not," Tenney said.
Seagate, the leading drive company, rose 2 3/8, or
11.5%, to 23 on volume of 5.5 million shares, compared
with a daily average of 3 million.
Quantum Corp. (QNTM) gained 2 13/16, or 13.2% to
24 1/16, with 8.5 million shares changing hands, Daily
average volume is 5.2 million.
Disk-drive equipment maker Komag Inc. (KMAG) rose
15/16, or 7.5%, to 13 1/2 on volume of 592,600
shares, compared with a daily average of 846,700.
-By Christopher Grimes; 201-938-5253
smartmoney.com |
